Now that the price of bitcoin has touched the All-time-high once again, it’s time to seriously consider whether and what you are missing out on by not trading cryptocurrencies.
Fortunately, bitcoin isn’t the only reason why you should be investing in cryptos. Besides huge profitability and the power of significant returns, cryptos, or more specifically the blockchain technology behind it, have strong fundamentals, which make them worth your while, especially in the long term.
What is a cryptocurrency?
A cryptocurrency is a digital currency, which works on the principles of blockchain technology, which means it allows peer-to-peer and middleman-free transactions between users globally.
Cryptocurrencies can be theoretically used for any types of digital transactions, including payments, money transfer, insurance purchase, shopping, identity verification, and more.
If you are looking for reasons to start trading cryptocurrencies, here are some:
Blockchain is the technology that powers bitcoin and many other cryptocurrencies out there. As the next-gen, decentralized finance (DeFi) technology, blockchain facilitates peer-to-peer transactions. In short, it offers a new kind of financial system that is free of middlemen such as banks and allows users to transact directly with each other. It’s affordable, more efficient and less time-consuming.
The good thing about the crypto industry is that Bitcoin isn’t the only cryptocurrency. It might be the king in terms of marketcap, but there are other coins that arguably have better potential than bitcoin. These are called altcoins.
Altcoins like ETH and Libra are disrupting the crypto industry through their revolutionary concepts. Libra Coin, for instance, is the first of its kind cryptocurrency (digital payment system) for e-commerce platforms that also acts as a multi-dimensional investment management system.
3. Growth in Demand
As more and more people are understanding the value of cryptos and the underlying blockchain technology, there is a high probability of mass adoption for cryptocurrencies in the coming days. Not only individuals, but many institutional investors are showing interest in the blockchain and want to benefit from the trend.
4. Great Returns on Investment
If for nothing else, you can always invest in cryptocurrencies for returns. Historically, cryptocurrencies have produced far higher returns compared to traditional markets including stocks and bonds. The price of bitcoin, for instance, has increased by 23401.36% since its launch (in 2010). Yes, that’s right. So, if you had, say, purchased 1 bitcoin ($0.08) in 2010, your investment would be worth over $30,000 today.
5. The Future is Bright
If you are worried that cryptocurrencies are too volatile and you might lose everything by investing in cryptocurrencies, let me tell you that this isn’t the case. As the adoption and demand for cryptocurrencies are rising, the market is becoming more stable. Soon, the world governments will have their own digital currency.
However, we still suggest you only invest (in cryptocurrencies) what you can afford to lose (in the worst-case scenario) and do your due diligence to find and invest in good cryptos.