Pros and Cons of Investing in Cryptocurrencies

One of the sexiest investments right now is cryptocurrencies. However, there is also a huge controversy; while some are fanatics, even insulting those who question it; others call it a great fraud, bubble or speculation. The truth lies somewhere in the middle between the two positions. Let’s review, without passion, the pros and cons of allocating resources to them.

1. The main “attraction” is the impressive performance they have shown. Failing to participate is like skipping the funniest party of the year.On the other hand, one of its risks is volatility, as it is at the mercy of speculation. Let’s take as an example what was called the new “crypto sensation”, the “Dogecoin”, with a rise of up to 12 thousand percent. The funny thing is that it was created as a joke and before a comment made by the billionaire Elon Musk, on “Saturday Night Live” it fell almost 35 percent in the hours after the program.
2. There is a rebellious and ideological approach to the support of cryptocurrencies, by removing the control of central banks over monetary assets, giving power to the masses, without mediating high transfer costs.On the other hand, expert economists point out that this would lead to an international crisis by removing the adjustments by the countries. The foregoing leads to a weakness, since governments would block indiscriminate propagation, and with the possibility that each nation creates its own. Although it is a way to “democratize” the creation of money, it helps anonymous transactions between criminal groups.
3. Liquidity is a topic of discussion. Indeed, the feasibility of making transactions has grown; however, it remains to be easy and you can acquire anything, as it would be with traditional money. In addition, it requires a certain degree of knowledge and confidence in the digital process, which for some is a problem.
4. The creation mechanism is very sui generis. By using “blockchain” it is shielded against the possibility of being hacked and with a limited production, but it is also critical when using a huge amount of non-renewable energy so that the servers can “mine”, in a world with a tendency to environmental care.

Finally, I quote Musk again, one of the richest men and a visionary businessman, who reported having invested one and a half billion dollars in cryptocurrencies, as he said, saying that it is unwise for people to invest their life savings in them. In fact, just on Wednesday he suspended the purchase of Tesla cars with Bitcoin, due to the consumption of “dirty energy” in mining. Those are the “chiaroscuros”; Each one decides if he enters and with how many resources; the important thing is to be sure of what it means to do it, both individually and for society. VectorVest offers the pros and cons of swing trading which will benefit more on your learning.

But is it too late to invest in Bitcoin?

The international currency applied in world business is the US dollar. When money needs to be delivered in national currencies, the conversion process to your national currency takes place. But today, there are other approaches that ensure sensitive data protection at a higher level and perform faster transactions. It is not a secret that cryptocurrencies are winning the trading market, especially Bitcoin.

Reasons why it’s not too late to invest in Bitcoin

Trading brokers, such as Exness, various companies, including those from the world of entertainment and investment have integrated Bitcoin into their performance system. One of the platforms designed to meet marketing objectives and buy or sell cryptocurrencies is MetaTrader 4, which promises to teach

How Does Bitcoin Work?

Bitcoin is virtual money that is used for purchases, sales, transferring money anywhere on the planet. This cryptocurrency does not exist physically but only in the digital world. It is the only currency that is not controlled by any authority. Therefore, consumers remain anonymous in all their transactions.

There are many other cryptocurrencies on the market, but Bitcoin is one of the oldest and most reputable. At the end of 2024, it reached US$67,000. To trade a cryptocurrency it must first be acquired. This virtual currency must be purchased for a fiat currency going through the conversion.

For this, it is necessary to enter the official Bitcoin website, register and open the digital wallet where the purchased cryptocurrencies are stored. Thus, there will be a special code that must be used as an address to receive or send Bitcoins to other people or companies.

Why is Bitcoin gaining more strength today?

These advantages are discovered in the algorithm of the blockchain system. It is a decentralized network of nodes linked and secured using cryptography. The Bitcoin boom started with a not very good presentation in the world. Some organizations used this cryptocurrency as a platform to make their illegal transactions anonymously. This led to international crime between various companies. As the cryptocurrency is not controlled by anyone, central banks, economists and governments have opposed this network.

But over time, many big companies have opened their doors and venture capital funds started investing in Bitcoin. Thus, with the advanced high-tech and mobile applications, this mode of payment has been more required. Little by little people and investors have changed their attitude and accepted cryptocurrency as one more opportunity to make a living.

According to JP Morgan analysts, the price of Bitcoin is going to make a sharp jump in the medium term and will reach an estimated figure of US$146,000. In addition, they believe that by the end of 2024 it will reach US$650,000.

When it comes to Bitcoin trading, there are five strategies used by experienced investors, but the first thing an investor should do is learn the peculiarities of each strategy in order to choose the most suitable one.

1. Intraday trading. It is a strategy of gaining a value between the day. It implies market movements open and close in just one day. Thus, the investor takes advantage of that time to obtain a profit. Under this method, the trader can avoid the costs and risks associated with holding them overnight. You can get more information here!
2. Scalping. It is determined as a faster strategy and risks without proper knowledge. Scalping involves making a profit on many trades. The business takes seconds, maximum a minute. This methodology is perfect for trading volatile assets such as cryptocurrencies.
3. Trading with trends. This type of trading involves maximizing profits from the trend, keeping the position open until the price rises. It is not necessary to open and close each position quickly. The trend can last within any time.
4. 4.Swing trading. Swing is based on price swings within a trend. It takes full advantage of market volatility. To perform this type of trading, one must know the technical indicators and the factors that move the markets.
5. Automated trading. This strategy involves a computer program to execute trade orders automatically. The investor can customize it and it is advantageous for being able to control the market within the day.

Each strategy has its advantages and disadvantages, but with in-depth knowledge and specific financial objectives, the investor will know which is the most suitable for his business with credit.

After all, is it worth investing in Bitcoin? For me, yes!