Why invest in cryptocurrencies?
The economic crisis of 2008 showed us that traditional banking systems are flawed. Since then this fact is confirmed on daily basis. More and more people are seeing the need for alternatives. And that is exactly what cryptocurrencies offer; a secure, decentralized form of banking that takes governments and banks out of the equation. Also, those two institutions started to realize and talk about how fragile the traditional monetary system is.
Some big tech guys like Elon Musk are spreading the word that crypto is a far better way to transfer value than a piece of paper.
Cryptocurrencies are the biggest technological invention since the internet. So you need to get familiarized with the technology asap. The good news is you’re still in time to start playing catch-up. Just like we now rely on the internet for information and communications, it’s soon going to be the same for financial transactions using blockchain.
You can make and receive payments with a crypto account or you can use it to save but the really big opportunities come with investing in crypto. If you would invest 1000 EUR in Bitcoin just five years ago that would be worth now around 25000 EUR. The price of Bitcoin and other cryptocurrencies is still set to keep going up. Because cryptocurrencies still present a small fraction of the monetary system there will be volatility on its way up. Now it’s the time to become crypto savvy and learn to spot the opportunities because you can be sure there are huge opportunities waiting.
Cryptocurrencies are a solid opportunity for fighting inflation. The problem with traditional money is that is always going down in value, because governments and central banks do it on purpose, especially when there is a financial crisis, by printing more of it. 22% of dollars that exist today were created in 2020 when the federal reserve injected 2 trillion dollars into the economy. The same policy is used by the European Central Bank. All that means that the value of the money goes down compared to the other goods and services and that is what we call inflation. Smart investors always look for hedges against inflation and cryptocurrencies are the answer, especially Bitcoin with its fixed supply.
It’s really easy to get involved with crypto. It’s way easier to get into than into most traditional investments. First, because it’s got high liquidity you can buy and sell it easily and quickly. Second, for stock and bonds, you usually need to put a large sum of money in and you can’t just put down 100 euros. With crypto on the other hand you can. And there are no institutions and no paperwork. Just get an account, get a wallet and track your assets.
In the crypto world, no one controls your money. So if regular money is controlled by governments and banks, crypto money is controlled by nobody and everybody at the same time. Bitcoin code is stored in thousands of nodes — that means that computers of tens of thousands of people who voluntarily run Bitcoin software on their computers. All users effectively retain control and it’s in everyone’s interest to keep the network active and healthy.
So if no one controls it, is it safe? The answer is a definite yes. It’s got the best security out there and the reason for that is in the way that information is stored. Any time that transaction takes place and digital money gets handed over to a new user, that gets recorded permanently and it can’t be erased.
Blockchain is here to stay. It’s important to understand that Bitcoin and other cryptos are built on blockchain in the same way that Facebook or Google are built on the top of the internet. Blockchain is the technology that makes crypto possible. Blockchain has many potential uses like recording data in complex environments, etc.
Cryptocurrencies are at an early stage and already disrupting markets. Bitcoin is actually already over 10 years old but now’s the time it’s really taking off and the growth it’s going to see in the next decade is going to be a whole load more exciting than what we’ve seen up till now. You can say that the stage right now is like the internet in the 90s. And just like the internet disrupted literally everything over the last 20 years, we’re probably looking at blockchain doing the same thing over the coming decades.
And…big business is taking it’s seriously. And so should you!