The pros and cons of investing in cryptocurrency

The pros and cons of investing in cryptocurrency

In the early ages, people used to exchange goods or services as there was no currency invented at that time. After some time people started using coins made up of gold or silver to purchase commodities and services. Paper currency was invented and it was totally under the control of the government. 

Cryptocurrency is the latest revolution; it is a digital currency that is used to buy or sell goods or services. It can take over the current financial system. It started back in 2009 when a white paper on bitcoin was published. Cryptocurrency only exists in the digital world, not in a tangible form or under any authority. 

There are more than 10,000 cryptocurrencies, some of the famous cryptocurrencies are bitcoin, dogecoin, Cardona, litecoin, etc. It is a decentralized currency which means that it is not controlled by any government. It cannot be affected by government policies and not affected by inflation.  

Cryptocurrency works on blockchain technology. There are thousands of cryptocurrencies, Bitcoin is one of them. Only 21 million Bitcoins exist in the world today. Cryptocurrency mining is the process that verifies and records new transactions and generates new coins in the process. Miners are the people who run computers with specific software and specifications to achieve this task. 

Are you feeling confused about whether to invest in cryptocurrency or not? I have made it easy for you to make a decision. You can read the pros and cons of investing in cryptocurrency and decide for yourself.

Pros of investing in cryptocurrency

Privacy

When you are paying with cryptocurrency such as bitcoin your transactions are completely private. No one can know the details of payment and the assets you bought or sold.  

Security

Cryptocurrency every transaction is recorded on a ledger which is maintained by thousands of computers around the world. Hence, it is almost impossible to tamper with transactions or steal them. Records and kept in blockchain technology that ensures the privacy and security of an individual. 

Decentralized

Cryptocurrency is not controlled by government policies. Governments do not get to decide how much bitcoin they want to print. Due to this cryptocurrency does not get affected by inflation and the politics of different world governments.   

Ease of payment

When we talk about paper currency, payments are done through banks and it requires bank accounts and transaction fees. This process is cumbersome while using cryptocurrency. You can pay bills with just one click without the involvement of a 3rd party.  

Cons of investing in cryptocurrency  

Payments for illegal business

As discussed above the transactions are anonymous and the cryptocurrency can be used to pay for illegal business around the world. It can also be used for money laundering. It is not controlled by any authorities so it is very hard to track the culprits down and give them punishments.   

Risk factor

If you lose your bitcoin due to some technical issue, there is no way to retrieve your currency. There is no complaint center where you can seek help. Hence, cryptocurrency is a skeptical and high-risk investment.

Not accepted by well-known brands 

Firstly, Elon Musk announced the acceptance of cryptocurrency as a method of payment. After his announcement, the stocks of bitcoin skyrocketed but later he announced that his company Tesla will not accept bitcoin as a method of payment. He said that the mining process is not environmentally friendly as it requires a large number of Hitech computers that consume electricity. Microsoft, Apple, etc are not accepting cryptocurrency as a mode of payment.

Ban by Government

China, Bangladesh, Egypt, Iraq, Qatar, etc many countries have fully banned cryptocurrency around the world. Some countries have restricted its usage. They consider it a source of money laundering and tax evasion.

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