SHOULD I BUY CRYPTOCURRENCY? (ALL YOU NEED TO KNOW ABOUT CRYPTOCURRENCY)
Many persons have misconceptions about cryptocurrency, especially as many think it’s the exclusive preserve of Yahoo Yahoo guys (internet fraudsters) but this is far from the truth. Cryptocurrency, in its real sense, is digital money. It differs from the physical currencies (dollars, euros, naira, etc) spent in that it is decentralized and has the same value globally and as such cannot be controlled by any government. Its popular units are bitcoins and ethereum.
A trader or an investor can decide to buy a bitcoin and keep it for a while and then sell or cash out at the time the coin has increased in value. The owner of the coin can also choose to use the coin to make transactions online. In fact, it’s been speculated that in years to come, with the advances in technology, cryptocurrency would be a popular way of paying for transactions both virtually and physically.
The origin of cryptocurrency dates back to the year 2009 when the first decentralized digital currency was created by Satoshi Nakamoto. It is digital money and can perform all the functions of money in countries where it is legislated to do so. It can be transferred, bought, sold, and traded on global exchange markets. It is stored in digital wallets and can be transferred between users through secure online platforms. People use these virtual coins for online transactions, to avoid transaction costs. Beyond the purpose of buying and selling, there are those who buy and hold crypto-currency with the intent of investment.
The major challenge most people have with Cryptocurrency is its high volatility. It falls under the class of investment with high risk. This implies that it can generate enormous returns or losses. Figures have it that in 2019, Bitcoin’s value was less than 4,000 dollars while on Jan 8, 2021, its worth rose to 41,490 dollars per bitcoin. Imagine! Cryptocurrency investors have gotten over 300% returns on their money (You can check out Anna’s story here: https://www.thetimes.co.UK/money-mentor/story/buying bitcoin/
The question then is: should you invest in Cryptocurrency? Yes, if you do not mind the volatility of the market and if you have other investments. The good thing about volatile periods is one can wait for the value of the currency to rise again before cashing out. But if you know you cannot handle the volatility of the currency market (especially if you have pressing emergencies that you need money for; or have anxiety disorders or are hypertensive) please don’t. It’s also wise to have other notable investments before investing in Cryptocurrency.
Investing in crypto, as it is more generally referred to by popular media involves buying the virtual currency and storing it in wallets. The purchase points for crypto-currency are called crypto-currency exchanges. There are various exchanges in use today, the most popular being Coinbase and Binance. These platforms allow you purchase currencies like bitcoin and ethereum. These currencies tend to be very pricey, especially those that have very greatly appreciated in value. It is not financially feasible for a lot of people to buy the coins in bulk. The silver lining, however, is that the coins can be bought in fractions. The crypto-currency model allows ordinary people to own these coins without investing thousands of dollars.
If you are looking to delve into a crypto-currency investment, then you better be ready to go long-term with it. Selling your coins when there is a decrease in value is not always a wise choice as the price could climb back up before you know it. Buying coins when they are at an all-time high value is also risky, as there is a possibility of a decline in price due to the extreme volatility of the market. The take-home from here is that it is necessary to do a proper analysis of any cryptocurrency before investing in it. Study the past trends and then proceed to use this data to predict how promising the future is for it.
Also, if you are resident in Nigeria and have any fears about cashing out because of the recent directive by the Federal Government or any other concerns about Cryptocurrency, do not hesitate to reach out to the Secure Capital Team. We’ll gladly answer all your questions.