Since the introduction of Bitcoin, the first ever cryptocurrency, back in 2009, cryptocurrencies have paved a path of their own in the world of investing. Part of decentralised finance, crypto investing is adopted by millions of investors around the world, especially young men and women in their twenties. Several new millionaires were created due to the rise of crypto coins, and crypto investing became the first ever experience in investing for many youngsters in the last decade or so. In this blog, let’s take a look at some of the benefits of investing in cryptocurrencies.
Cryptocurrencies are built on blockchain networks, which are public ledgers formed by peer to peer connected computer networks called as nodes. When bitcoin was introduced in 2009, it remained the single digital currency until April 2011, when Namecoin was introduced, followed by Litecoin later that year. Soon, more and more crypto coins were introduced in the market with unique functions and utilities, collectively known as altcoins. For example, Ethereum network introduced smart contracts and decentralised applications, with their cryptocurrency, Ether, acting as a medium of currency to gain access to services and products within the ecosystem. Some countries like Venezuela are promoting cryptocurrencies so much that they have become a parallel mode of payment even in domestic retail stores.
Investing in cryptocurrencies has many benefits. Some of them are:
As we had discussed before, it’s the volatility of crypto prices that creates the potential for high returns. But, the same volatility can result in huge losses too. Many people who traded on cryptocurrencies with no risk management strategies like using stop losses have incurred huge losses. Also, the act of cryptocurrency mining is a high energy consuming activity, often raising environmental concerns as well. Additionally, lack of regulations can be problematic when it comes to scams as no central body like banks or governments can protect your capital.
Several new crypto projects are mushrooming every other week with giant promises, but offering no utilities worth pursuing. Soon, when these projects undergo their natural demise, investors lose their money. Also, due to privacy and non-regulation, many people use crypto transactions to engage in illegal activities. Above all that, there are occasional security breaches, where hackers steal crypto coins worth millions of dollars.
Cryptocurrencies are a great option to invest in, if you do proper research and invest with caution. Also, one should take necessary risk management strategies to avoid big losses. Investing in crypto has many benefits. You can use crypto investing to hedge against inflation, as it stays independent from centralised finance systems. Also, there are possibilities for high returns, due to high volatility of cryptocurrencies. Additionally, the decentralised approach and high security through cryptography provide additional benefits, along with being an investment option to diversify your portfolio.
With Seven Capitals, you can now trade in cryptocurrencies with ease. We give access to trading various crypto coins such as Bitcoin, Ethereum, Litecoin, and much more. With our advanced MetaTrader 5 trading platform and 24/7 customer support, you may reap the benefits of engaging in crypto trading either.
Great talent deserves great recognition. Come and be a part of something big!
Support