Jacob, a young aspiring student, has been watching the passion for the cryptocurrency investment boom in the global market. The recognition and growth of cryptocurrencies like Bitcoin, Ethereum, Litecoin, Tether, Dogecoin have compelled investors and hesitant folks to dive in. But is investing in cryptocurrency a bad idea?
Understanding cryptocurrency(or crypto) is easy. Crypto is a digital and decentralized currency issued by a private system and remains out of the purview of the government. It’s a peer-to-peer system that will enable anyone to send and receive payments anytime. Jacob will get to store his cryptocurrency through a digital wallet. Opening a cryptocurrency trading account for investing and understanding the basics is the beginning step ahead. Crypto exchanges are similar to stock exchanges in the sense that they let you buy or sell tokens in real-time.
There have been over 4,000 different cryptocurrencies in circulation worldwide, including the market giants Bitcoin, Ethereum, Litecoin, and Dogecoin. Folks invest their interest in these unregulated currencies is to trade for profit, with investors/speculators sometimes driving prices immensely. To open an account, you need to find a legitimate platform that will protect your sensitive data. Crypto Media Network (CMN) is a genuine and unbiased media platform and community composed exclusively of the latest stories from professional writers that value ethical, authentic journalism that can lead you to the correct platforms.
Fiat currencies like the Dollar, Euro, Yen, and Rupee are not linked to any physical reserve. It can lose its value to inflation. The availability of cryptocurrencies depends on mining. Bitcoin mining is a process by which new Bitcoins (crypto) can enter the market. Bitcoin rewards its miners some fractions as an incentive to motivate people. Continuous mining legitimizes and monitors Bitcoin transactions to help prevent the double-spending problem, ensuring their legitimacy. Double spending is a situation in which a Bitcoin owner illicitly spends the same Bitcoin twice.
In physical currency, once you hand someone a $20 bill to buy a bottle of vodka, you no longer have it. There is no danger you could use that same $20 bill to buy lottery tickets next door. While there is the possibility of forging cash, it is not the same as literally spending the same dollar twice. With digital currency, the Investopedia dictionary explains, There is a risk that the holder could make a copy of the digital token and send it to a merchant or another party while retaining the original.
According to Crypto Media Network (CMN) these 10 things you should know about cryptocurrencies.
- Investing in crypto is not Illegal
- Cryptocurrency transactions are taxed
- Cryptocurrencies are not expensive
- The value of crypto is as real as Rupee
- Protocol upgrade reduces transaction costs
- Upcoming portal drop excites the community
- NFT summer brings an added boost
- Neso and Celsius, the lending platforms
- Earn BTC from centralized exchanges
- Margin traders keep most of their cash on hard wallets
CMN news conducted a survey where more than 10% said they’re invested in cryptocurrency, ranking the digital coins fourth after real estate, stocks, mutual funds, and bonds. Some 65% of those cryptocurrency holders bounced up to their positions in the asset class in the last year. At the same time, the prices of some of the top cryptocurrencies have displayed brand volatility.
Bitcoin price prediction attained a record-breaking value of more than $63,000 in April, collapsed soon, and recently revived to nearly $50,000. Among some frequent traders of cryptocurrencies, the top reasons mentioned are that it’s easy to make trades, exciting to invest in, and there is a huge potential for high growth in a short period.
The crypto market is fast-paced, volatile. You can imagine that the news surrounding the market is just as impactful. As with most industries, some shady people try to take advantage of inexperienced people by releasing biased, deceptive, or just plain fake news and information for their benefit.
FAQs | CRYPTOCURRENCY
- Investments are always risky. But a small fraction of your investment can handle that much risk and, the return scenario will be beyond all.
- Invest in cryptocurrencies that you believe will increase in value, and hold on to them for at least three to five years. Keep monitoring them once in a while.
- There are several methods of risk management with cryptocurrencies mentioned down below:
- Instead of putting all your eggs in one basket, put ½ – 1 egg in this basket of crypto in the form of small fractions. Investment 2-3% of the investment amount.
- Keep monitoring your investment and, don’t panic when you observe the downtrend. Its volatility will revive your money.