Wondering if you should invest in Bitcoin? If you’ve been in any child’s financial affairs lately, you have no doubt heard about the rising climate in the world’s most popular cryptocurrency.
And if you’re like most people right now, you’re probably wondering, “Bitcoin – yes or no?”
Should you invest? Is it a good way? And what is the heck of Bitcoin anyway?
Here are a few things you should know about Bitcoin before investing. Also note that this article is for informational purposes only and should not be construed as a form of financial advice.
What is Bitcoin?
Bitcoin is known as a cryptocurrency or digital currency. Basically money online. As with any currency you can exchange some currencies (say, buy bitcoins in US dollars or vice versa) and it fluctuates with other currencies as well.
Unlike other currencies it is still distributed, which means that no single bank, country or government is in control. And that means it is not involved in the mismanagement of the government or the central bank.
The beauty of Bitcoin
1 Easy to Send Money
Because it is enabled, this also means that you can send a friend Bitcoin (money) to the other side of the world in seconds without having to go through a bank link (and pay your bank account).
This fact alone makes Bitcoin very popular. Instead of waiting for a wire transfer to take days, you can send your payment in seconds or minutes.
2 Rated Sales
There are only 21 million Bitcoins that will ever be stored. This reduces the amount of Bitcoin that can be generated. This is similar to the fact that the government cannot print money because there is a limited amount of debt – and they can no longer print it.
When there is a set set your purchasing power is maintained and the money is not secured by fleeing amounts.
This limited supply has also helped to contribute to the rise in the price of Bitcoin. People do not want money that cannot be printed – or inflated – to end up at the behest of a greedy government.
Most people think that Bitcoin is completely unknown. But in reality it is not a mystery – it is very secretive. All Bitcoin transactions made can be seen in Blockchain – the Bitcoin public forum.
But your name and post-transaction details are not recognized. Each transaction is linked to an address – text string and characters. So while people can see your address – there is no way to link that address to you.
Many people who do not like their banks to check them out (or tell them how much of their money they can or cannot withdraw), really like this aspect of privacy.
4 Transactions are cheaper
Many businesses have to take a Visa or MasterCard these days to stay competitive. However, these cards take a certain amount of money for each transaction.
But the seller who accepts Bitcoin does not pay these big bills – so it puts a lot of money in their pockets.
So those are some of the main benefits of Bitcoins. What about cons?
The disadvantages of Bitcoin
1 Risk – Price fluctuations
Bitcoin is known for its slow growth over the months – and then falling 20 – 50% in a few days.
Because it is sold 24 hours a day 7 days a week, the price is constantly changing. And it all takes some bad news – like the hack Gox hack news a few years ago – to send a drop in price.
So it’s actually not stable – and there’s a lot of unknown out there that could affect the price. The rule here is this: do not invest in Bitcoin that you will not be able to throw away.
2 Decreasing Buying Speed
Bitcoin is beginning to face problems with slower transaction speeds and higher transaction costs. Some cryptocurrencies have arrived faster and cheaper.
Bitcoin miners are working on this problem. However, until these issues are resolved, you can expect the price to get worse.
3 Bitcoin Transactions Not Refundable
Unlike credit card billing, Bitcoin transactions are not refundable. So if you send Bitcoin to the wrong address – you can’t get it back.
Also, there are many stories from people who have lost their Bitcoin wallet address (hacking, stolen phones, infected computers, etc.) and have completely lost their coins. There is no way to get it back.
For this reason, you need to know what you are doing and take your time researching how to buy and store your coins properly if you want to invest in Bitcoins – or another cryptocurrency.
So those are some of the things to consider before investing in Bitcoin. Especially while Bitcoin has a lot of good things to do for it – and while it has the potential to change financial transactions as we know it – there is still a lot of risk. There is still much unknown there.
If you decide to buy, take the time to research your options. Do not buy from any seller. Some of them are honest and run a good business. But there are other things that will cost you too much and may not even bring you your coins.
Be safe and do your research first. Find a reputable dealer with a stellar reputation – there are plenty of them out there. And remember the golden rule here – never invest more than you can afford.
Donate Bitcoin to this address
Scan the QR code or copy the address below into your wallet to send some Bitcoin