Software

Why Is Cryptocurrency Considered A Modern Form Of Investment?

Cryptocurrency is the newest form of modern investment. Cryptocurrency is electronic money that uses cryptography to control its creation and transactions and works independently of a central bank or government. Starting with Bitcoin in 2009, cryptocurrency gained acceptance by many individuals who saw it as an opportunity to invest in something they believe will help them make more money through investing than they do via conventional means. Today, many people are investing in Ethereum, Bitcoin, Litecoin, Ripple, etc. If you’re interested in knowing the comparative study on investments in crypto and banks click here.

Benefits of using cryptocurrency for investment

– The volatility of cryptocurrency:

There is a lot of volatility in cryptocurrency, which is the primary concern for most investors. However, if you know how to predict the market movement and take advantage of it, you will profit.

– High returns:

Cryptocurrency’s return is measured in percentage points per day or the number of days since its creation to today. It differs from other types of investment that may have a fixed return or money reinvested at a fixed rate depending on the time they are invested. With cryptocurrency, there are no maturity dates, and it can be kept as long as you want without any loss and safety issues that come with other investments such as stocks, shares, and Oil Profit.

– Low transaction fee:

Cryptocurrency is an open-source project created to function as a peer-to-peer, decentralized form of digital currency via blockchain technology. Every transaction on the cryptocurrency blockchain has meager transaction fees compared to traditional transactions of banking institutions and credit cards.

– No timing or sales restrictions:

When you invest in cryptocurrency, you are not restricted from trading it at any time and are not required to make any pre-sale purchase as a mandatory step before selling the coins for a profit. As a cryptocurrency investor, there are no limitations on when you can sell your coins and how many times during a year.

– 24/7 trading:

Since cryptocurrency is open 24/7 for trading, the opportunity to trade it at any time can be crucial for investors who want maximum profit through high volatility in price fluctuations.

– No access restrictions:

Cryptocurrency is a universal currency that has no geographical boundaries and can be accessed by anybody, anywhere at any time. Unlike other investments such as stocks, forex, and commodities trading, which are limited to a particular country or region, cryptocurrency’s advantage lies in its ability to be accessed by anyone globally. Currently, 70% of the world population has not been exposed to cryptocurrency trading, but they could access it once they learn how it works and how profitable it can be as an investment option.

– Security:

The most important and the most favorable aspect of cryptocurrency is the idea that it is decentralized and structured on the blockchain. This means any transaction or trade on cryptocurrency technology can only be made by its owner or authorized holder who holds a private key to access it.

– Minimal Risk:

Since cryptocurrencies are digital, you need to understand the risks involved when you decide to invest in them. Cryptocurrencies are primarily traded on exchanges, with more than 31% of trading being done through online platforms such as Coinbase, Binance, Bittrex, etc. As a new user of this market, there is no risk of getting hacked by hackers who try to steal your private key and let other users in exchange for getting access to your money.

– No tax:

Since cryptocurrency is encrypted and anonymous, government tax agencies will not discover any transaction you make. Therefore, unlike other forms of investment like bonds and stocks, there is no need to pay tax on cryptocurrency gain, where a percentage of your total profit is subjected to tax. As long as you keep the information about your transactions private, there will never be an obligation for you to pay taxes on any profits you have made through cryptocurrency trading or investments.

– Minimal government interference:

As compared to other forms of investment, cryptocurrency investments are outside the reach of all types of government interference since they are decentralized, network-based, and not owned by any bank. This means that trading in cryptocurrency is different from any other form of investment and that traders can trade various cryptocurrencies based on their choice and preference.

– Natural disaster-proof:

Cryptocurrency is a digital technology spread across all computers connected to the internet anywhere in the world. Hence, if a natural disaster such as a flood or hurricane at one location, it will not affect investors making transactions from another location where there has been no effect of natural disasters such as floods or hurricanes.