Is now a good time to invest in Bitcoin?

Is now a good time to invest in Bitcoin?

Bitcoins are finding great favor among celebrities, entrepreneurs and investors alike across the globe and are forming a wonderful mode of virtual investment. But there are some intriguing questions asked about this digital currency, especially related to its validity and reliability. Major Banks all over the world seem to be not much happy about this digital currency. However, the rates of Bitcoins are only seen to be rising further. The experts do feel that there could be a bubble burst sometime in the near future. Hence, those interested to invest in the Bitcoin should need to carry out proper research before going ahead with their investment.

As a matter of fact, Bitcoin along with other cryptocurrencies will take some time to be accepted in the mainstream. Investors are quite excited with this investment form. The rate of single bitcoin in January 2017 was $1,000 and it went to about $20,000 on few exchanges by December.

Its appeal

Its appeal is not simply based upon its current value upswing. Some are of the opinion that its flexibleness as global exchange as well as 3rd party regulation does offer benefits. Those investing in it do have full control of the account keys associated with their digital wallet, a software type to store bitcoins. Few state that cryptocurrencies, including Bitcoins are less susceptible towards fluctuations in the stock market as they tend to operate within their own small world. However, financial gurus like Warren Buffet have been urging investors to take caution. Already, this crytocurency has shown to be volatile. Not having any kind of history to draw reference from, it can be tough to predict the future. Apart from this, there are different types of risks involved.

Know the risks

When compared to bond or stock, it is a different form of investment and is quite similar to making investments in oil or gold. In short, it depends upon strong price appreciation and is required to be ahead of inflation.

The other risk is not having proper regulation. There is also not present any guideline set by financial institutions to be followed. This means, consumer protection and financial safety is a big question. Besides this, there are issues with account protection, digital security systems and FDIC insurance.

This cryptocurrency might appear to be more secure when compared to physical money kept in the bank. However, it comes with its own share of risks, ranging from technology failure, account problems to advanced hackers preying the accounts. Also there is the possibility of the hard drives storing the bitcoin keys getting damaged, wiped or stolen or own account could get locked up due to wrong usage. There will be not be present any bank employee to assist with password retrieval.

Overall, consulting an expert in the domain is sure to help take a smart decision.

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