When you talk about investing, the cryptocurrency market has become such a point of interest due to its exponential growth throughout the years. Take Bitcoin, for instance. The shining example of cryptocurrency has shown such a steep rise in value since its inception in 2009. In January 2017, the price of Bitcoin was around $800. Fast forward to two years later, CoinMarketCap places its value at more than $11000. Sounds like a great return on investment, right? So should you start investing in cryptocurrency?
If you’re one of the people who have yet to buy into the crypto hype, should you start doing so? Would it be a worthy investment? Hold that thought for a few minutes. Before you begin your foray into the cryptocurrency world, read this article.
Cryptocurrency facilitates straightforward transactions, avoiding the need for banks and other payment systems to be involved. Why is this significant? Well, bypassing these third-party institutions minimizes the processing fees usually associated with cash and card transactions. This also speeds up the process by avoiding the hassle of transacting with middle men.
There is also the added benefit of increasing the privacy of your dealings. This means the probability of identity theft due to data breaches in third party institutions is mitigated. The security, transparency, and immutability of transactions offered by blockchain is another attractive aspect of cryptocurrency investment.
It can serve as an alternative to financial transactions such as remittance and purchase of goods. However, keep in mind that all transactions made with this type of currency is final. Once you send a payment, you cannot retract it. There are several promising avenues of crypto that you can be a part of should you choose to invest in it.
Huge Return on Investment
There is this belief about entering the crypto world: the earlier, the better. Investing in this type of currency will eventually bring fruit but it will take time and a sufficient amount of knowledge to master it. Popular currencies such as Bitcoin and Ethereum can give you as much as six to 46 times your initial investment. Indeed, the early adopters of Bitcoin are seeing huge returns nowadays.
Aside from these two, there are also other coins that can be quite promising in the market. The key is to research about their purpose, and invest in what is most compatible with your personal finances. Think carefully as these currencies are highly volatile.
Cryptocurrency promises a long-term and viable difference in your investments. If you are planning to have a huge return of investment (which we all are), you should start looking for long-term investments.
Empowerment of Ideologies
Are you tired of government institutions, large financial corporations, or monopolistic groups? Unlike cryptocurrency, these types of institutions are usually governed by a centralized system that sets the rules on your transactions. With crypto, you are free to use your currency the way you want it. This decentralization empowers the masses by creating an atmosphere that is more collaborative and people centered. You have full control over your hard-earned money. Transfer and receive coins anytime and anywhere at your own convenience.
Due to blockchain, users can transact with each other without disrupting the whole system. They get a sense of responsibility in making the system work. The beauty of decentralization is that it is powered by its various members and not a single entity.
Revolutionary Technological Innovation
One of crypto’s monikers is “money of the future.” Indeed, there are people who claim we are heading towards a cashless society. This is further supported by the increasing number of banks and financial institutions like American bank JP Morgan Chase adopting crypto or including it in their infrastructure, it does seem more and more like crypto is the next big step in finance and trade.
However, crypto alone is not being lauded as a great innovation. Blockchain, the technology behind cryptocurrency, has the potential to create waves in different industries, including but not limited to accounting, supply chain management, healthcare, and medicine.
One of the most talked about aspects of blockchain is its decentralized nature, meant to be a game changer in the way we conduct and record transactions. Essentially, what this means is there is no central figure that governs transactions, enabling it to be less costly, more secure, and unmanipulable.
Blockchain has recently emerged in other industries such as in academia, real estate, healthcare, and networking. In the education sector, the Sony Global Education in partnership with IBM, has developed an educational network that makes use of blockchain. It facilitates the verification of the student records efficiently and prevents the likelihood of fake degree holders in the institution.
Real Application In Real Estate
In the real estate world, the blockchains promotes transparency within the system. It permits other authorized members of the community to check and verify the records on buying and selling properties. With this, possible fraudulence is avoided. Ubiquity is developed for this industry.
The healthcare sector has also adopted blockchain for the Gem Health Network, which allows healthcare providers and ] payors to share access to their data without compromising it. Like Ubiquity, this allows for the transparency of information among them.
Moreover, Samsung and IBM also developed ADEPT which created a decentralized network of IoTs. The devices are directly communicating with each other to fix bugs and update its software. This gives them the ability to repair detected damages almost immediately.
As you can see, blockchain’s application is not limited to the banking and finance industry. Other industries have a lot to benefit from the transparency and security afforded by this technology.
Joining the Bandwagon
As much as it promises many opportunities, some say that people invest in cryptocurrency simply because of its rising popularity. As the prices and returns go up, the media tends to advertise it in different ways. Widespread coverage in different media platforms have given people FOMO (fear of missing out). This is a manifestation of herd mentality. There are also theories that the media coverage can affect our perception of what is trustworthy and useful. So the more crypto is covered by various media platforms in a positive light, the more we may deem it useful.
A researcher by the name of Benedetto De Martino conducted a study analyzing the behavior of the people investing in crypto. They found out that the areas of the brain responsible for evaluating others’ thoughts and behavior are active when a person makes a decision in investment.
The reason, according to De Martino and his team, is called theory of the mind. This means that humans tend to assess what others will do in the future. This makes them likely to get involved with the hype. Some people with heightened senses have the tendency to get involved before others do because they think that is what the other members will eventually do.
Food for Thought
Ultimately, the decision to explore the cryptocurrency universe is your decision. The ideas presented above are just a few reasons other people have taken the plunge. For every financial analyst that supports cryptocurrency, there will be an equal amount who are against it. This is because of its volatile history and speculative nature.
However, it cannot be denied that an investment in crypto is also an investment on the future of blockchain technology. It’s up to you whether you want to be immersed in its continuing development. Don’t just mindlessly invest your hard-earned cash. Do the research and understand all the factors that come into play with your decision.