1. What are cryptocurrencies and why should you bother to invest in them?
In order to invest in Cryptocurrencies, some entry-level knowledge is required.
Cryptocurrency is a digital currency that is designed to work as a medium of exchange in an online environment, It uses cryptography to verify and make transactions safe as well as to control the creation of new units of a particular cryptocurrency.
In a nutshell, cryptocurrencies are limited entries in a database that no one can change unless specific conditions are met.
Many companies have created their own currencies and most of the time these can be traded for the good or service that the company provides.
If you’re asking why there are so many, all these cryptocurrencies aim for, is to leverage blockchain technology to revolutionize the most diverse areas such as finance, health, energy, data storage, privacy and security, machine learning, payments, social networks, supply and logistics, and content ownership and the list goes on.
Another reason why there are so many is due to Bitcoin’s huge success over the years along with a few other altcoins proving they’re worthy of your attention.
When Bitcoin was first created, very few people knew what it was and what it would eventually become, just to have an idea, at Bitcoin’s early stages of life, around 2010, 1 Bitcoin was worth a mere 0.0010$ and it didn’t change much for a long period of time.
There was one particular case, perhaps the most iconic one in Bitcoin’s history which happened on May 22, 2010, now known as Bitcoin Pizza Day, Laszlo Hanyecz paid 10,000 Bitcoins for two Papa John’s pizzas.
The request was posted on bitcointalk forum, “I’ll pay 10,000 bitcoins for a couple of pizzas.. like maybe 2 large ones so I have some left over for the next day”.
Fast forward to 2017, Bitcoin and almost every other altcoin exploded, people who held to it became overnight millionaires, as Bitcoin rose to about $20,000 per coin at its all-time high. Suddenly everybody realized the potential of cryptocurrencies.
There is now a very solid base of information on this subject and ways to easily purchase different coins without leaving home.
Should you invest?
That’s a question that only you can answer but since you are reading this, I assume you are at least curious.
This Year, Bitcoin was hovering around $3,600 USD in March and quickly came up to around $10,000 USD in May.
Here’s a short list of reasons to invest:
Your money is yours
With the traditional bank which is probably where you hold your money, you are dependent on the healthy functioning of the bank’s ecosystem and all the external entities who feed the bank’s existence, at any given moment your access to your own money can be cut short, the bank can be robbed or suddenly go bankrupt, those risks are less common if you’re a client of a state-owned bank but even with those, you are still leaving your money in possession of institutionalized hands.
With cryptocurrencies, your money is yours, you never rely on financial institutions for holding or transferring it and you also don’t have to pay their fees, in the long run and if adopted properly, it can be the start of a truly open and decentralized economy. By investing now, you are taking steps to future freedom.
After analyzing the current most popular investment methods being one of them the stock market, we can all agree that Cryptocurrency investment has been by far the most profitable for the past few years.
The historical average stock market return is 10%, cryptocurrencies tend to show wild changes in their prices over short periods of time, it’s common to have 10% changes over the period of days or a week, it’s a risky investment but also one that when done properly will make you big cash in no time, such potential is unlikely in other assets.
Start with a small amount
Many brokers will ask you for a very substantial amount of money to start investing in stocks and this is particularly true if you have no previous knowledge.
With cryptocurrency it’s as simple as signing up for a trading platform, fill in personal data (this includes your bank account which acts as an intermediate between currencies) and you will be set up, you can deposit money or directly buy cryptocurrency with as little as 2$, please note that you will have some residual fees in some transactions, if you want to avoid the most part just buy and let it sit until it turns profitable enough for you, we’ll list our preference of choice by the end of this article.
Why should you invest now?
As of now, the Covid 19 Pandemic has pretty much twisted and devastated the world’s economy and, very likely but yet unfortunate, you probably know about someone who just sold the house, car, and every other asset in their possession to bare through the crisis but just like many times before, the market will bounce back and thrive, and it’s good to keep this in mind because the market always bounces back.
Contrary to common action, you should invest whenever the market is down (this usually means sales!), you will benefit from this action alone and later witness your bold act transform into solid returns when the market stabilizes once again, it’s no easy task, patience pays a huge role in creating wealth and you must resist the urge to panic sell whenever you see the price of your assets going down the drain, it will come up eventually and everything will work out, just don’t buy when the price is high.
For now, Bitcoin’s price has been hovering around 10.000$ for quite some time.
Is Cryptocurrency a Safe investment?
In a short sentence, not by a long shot!
But its appeal is precisely on its volatility which in extreme cases can either turn you into an overnight millionaire or an overnight dumpster diver.
Assuming you won’t invest any more than you can dispose of, it’s pretty much a safe bet in the long term if you’re capable of following the previous pieces of advice in this article, do it safely as there is no rule of thumb when it comes to investing.
How can you start?
The best place to start is Coinbase.
They offer a secure way to invest in cryptocurrencies and feature a growing list of about 30 cryptocurrencies at the moment, all that with a simple and intuitive user interface, It is a great platform to learn.
There are two different platforms from the same company, Coinbase, and Coinbase Pro, to highlight the difference between these two products: Coinbase is a place for consumers to easily buy, sell, and store digital currency and Coinbase Pro is an exchange to trade digital assets.
Coinbase Pro has cheaper fees with more features and is free to use for anyone with a Coinbase account (you can easily transfer funds between these platforms).
You can sign up here:
How much will Bitcoin be worth in 10 years?
No one knows and if anyone says otherwise they are lying but since we are speaking of a possible future defining technology, our guess is that it will be worth way more than it was back in 2017 when it reached its peak value.
Although we currently have a wide variety of “experts” throwing expectations and optimistic views on the subject, on the other hand, there are also people who believe that investing in crypto assets equals burning money.
We are optimistic about what the next 10 years will bring to the table.