Virtual currencies are digital assets widely being used for making purchases online or as an investment by the people. Anyone can buy cryptocurrencies by simplying depositing fiat currency using a crypto exchange platform. Coinbase and Binance are one of the most repute and secure crypto exchanges. Thanks to a huge success of Bitcoin, people have started taking crytocurrencies and blockchain technology seriously. If you, too, are looking to invest in cryptocurrencies, be sure to consider the following points:
Make sure it’s legal in your area
Since there’s no central body monitoring cryptocurrencies, such currencies can easily be used for nefarious activities such as money laundering. If you’ve made a decision of investing in cryptocurrencies, you should double check if it’s legal in your country. Investing in cryptocurrenies in certain locations can land you in hot water.
You can either earn huge profits or bear big loses in a blink of an eye. You should consider this aspect when investing in digital currency. The value of digital currencies keeps changing all the time, going through extreme downs and ups. What sets this apart from fiat currencies is that cryptocurrencies are not regulated by any central authority meaning there’s no one controlling its value.
Unproven return rate
It’s safe to say that investing cryptocurrencies is more like gambling. You can either win huge or lose everything in a blink of an eye. No one can predict anything or calculate returns. There isn’t enough credibility, data to create a long term investing plan for digital currencies.
How do you look at this? Have something to add to this? Please feel free to offer your feedback in the comments below.
As a writer, Ruben is an advocate of blockchain technology and cryptocurrency in general. He writes about all things from cryptography to economics, with a focus on how it applies to cryptocurrencies. He is also passionate about writing about topics such as decentralization, open-sourced software development, and copyright law.