Cryptocurrency has transformed from a fringe curiosity to a mainstream trading medium within a very short span of time. The world’s first cryptocurrency, bitcoin, was launched in January 2009, shortly after the financial crisis rocked the global markets. It took a decade for it to become one of the most sought-after digital assets. While it remained in oblivion for most of that decade, its sudden rise prompted many such coins to flourish. A primary reason for their rise was the promise of almost vertical returns. It is no surprise that investors flock to these new digital assets to gain a foothold.
But the question still remains: should one invest in digital assets? put another way. Why should people invest in digital assets like bitcoin or any other crypto coin? These coins are extremely volatile – as they rise, they fall even faster. Since these work online, which security features will protect the investor’s money?
True, most of these digital assets are volatile. Experts say that as they grow and gain acceptance and more people start trading in or with these coins, they will gain stability like the stock markets. But what about security? The cryptocurrency world runs on blockchain technology, which is new and many people are still not aware of it.
However, technical experts say that the technology is very democratic in its approach and completely safe to use. It is based on the idea of a Digital Distributed Ledger, which means that anyone can view any transaction from anywhere at any time. Every transaction is stored as data on the blockchain and no one can mess with it.
There are also some advantages of investing in these:
1. A flourishing field
Over the past two years, the cryptocurrency market has grown by leaps and bounds. For example, at the end of 2019, the price of bitcoin was slightly above $7,000 (approximately Rs 5.18 lakh), but today it is trading above $45,000 (approximately Rs 33.34 lakh). In both February and April this year, it touched a price of above $ 60,000 (about Rs 44.46 lakh).
2. Digital Ecosystem
Not just cryptocurrencies, but a new digital ecosystem is taking shape in the post-pandemic world. In addition to cryptocurrency, there are NFTs or non-fungible tokens. Moreover, instead of investing directly in crypto coins, technocrats are also getting involved in the process of making these coins, which is called mining, and earn a decent income.
3. Impressive Returns
The cryptocurrency gives one of the best returns, matched only by the realty sector. Unlike in the realty sector, investing in digital assets does not require you to invest a huge amount. You can break your investment into several pieces.
4. Passive Income
Investing in digital assets and online businesses is a good way to earn passive income. You can continue this with your regular investments and without much sweat, money will be credited to your account through a steady income.