Cryptocurrency is gaining recognition all over the world as more and more billionaires are investing in it. Since the advent of Bitcoin in 2009, more than 10,000 different virtual coins have been released. The more investment a coin receives, the more value it gains. Virtual finance is as realistic as virtual betting at Netbet.
As opposed to the traditional financial system, crypto investment offers promising rewards, high security and more transparent financial systems. The risks are just as high as well and the expansion of crypto can drastically affect the environment.
Listen below are the pros and cons of crypto that will help set your priority, about investing in crypto, straight
Pros of Crypto
1. High Reward
The number of cryptocurrencies in the market is greater than 10,000, with every single one having its own particular value. All of these currencies have several common things as well such as their volatility.
Prices of these coins depend on the supply and demand by miners and purchasers. This market phenomenon can result in great rewards that are usually beyond expectations. For instance, those who bet a short on bitcoin just before its crash, multiplied their investments manifold.
2. Extremely Secure
The underlying technology to build cryptocurrency is blockchain, it is completely secure. The information in the form of data is decentralized, which cannot be accessed by hackers in one go.
Unlike traditional banks that have centralized intermediaries, there is no single point of failure with cryptocurrency. This digital currency promises a secure future, where the chances of failure of financial institutions are comparatively low.
3. Transparent Financial Records
With traditional banks, you have to put your trust in these intermediaries to keep your money safe. The recessions have made people suspicious about the conventional financial system. Cryptocurrency gives you more freedom over your finances and you can always track them.
With crypto, there are no intermediaries, or any lengthy processes to get your own money. You decide how long it stays with you, and when and where it goes.
4. Beat Inflation
The traditional currencies are tied to the value of the dollar, which is not the case with cryptocurrency. Instead of national inflation, cryptocurrencies represent global demand and it is not dependent on any economy or currency.
Cons of Crypto
1. Requires Time and Effort
The idea of digital currency is new and some non-tech savvy people can’t grasp the concept of blockchain. Before investing in crypto, you need to have a know-how of how the market works.
If you plan on keeping your investment safe, you also need to learn to analyze charts and make your decisions based on that analysis. This crypto education can take a lot of your time and effort.
2. Volatile Market Imposes Serious Risks
Even though the rewards may be high, the risk of losing your investment is also significantly high. No matter which currency you invest in, even the most mature currency often crashes. The crash of Bitcoin in 2018 resulted in the loss of investment of a large amount of people.
You should only invest in crypto when you have enough money that can be used in this experiment. Do not invest in it if you are barely making the ends meet.
3. Harmful to Environment
The mining of coins is an energy-intensive process that poses an imminent threat to the climate. For instance, Bitcoin mining consumed an electricity of around 36 Billion KWh, which is equivalent to the total energy consumption of some small European countries.
Due to the use of a great amount of energy for its expansion, crypto will definitely have harmful effects on the environment in the future.