Until recently, gold, silver, etc. were widespread means of storing value. Many people trusted metals more than a currency such as the euro or the dollar, because metals exist in finite quantities. Because of this, they will hardly lose their value, unlike fiat currencies that are "printed" at will and have no counterpart.
The problems with gold and metals in general are multiple:
- It is difficult to store. If we keep quantities of gold, we also need a space to store them safely.
- It is not easy to exchange. In our time it is impossible to pay with gold in our transactions and especially when the transactions are done electronically.
Bitcoin and cryptocurrencies in general, in addition to trading systems, allow us to store value in them. And in fact a value that we can exchange at any time, something that is unprecedented for those who are used to the idea of precious metals. Cryptocurrencies share some of the positive features of metals, but without their negatives. Specifically:
- Each cryptocurrency has (usually) a certain number of total currencies that will be created.
- Currency production is done in a predetermined way and not at will as in fiat currencies.
- The value we store in a cryptocurrency is immediately "exchangeable" and even Online.
- They can be divided into several subdivisions (usually 8 decimal places or more).
- They are extremely simple to store.
- Their storage can (and should) be protected by a password.
- We can have backups.
The above reasons make cryptocurrencies tempting in storing value in them. In addition, because their value is determined solely by the law of supply and demand, the more people discover their benefits, the greater the demand and therefore their value.
The above are the characteristics that an investor wants from his investment. That's why articles like the one that predict that the value of Bitcoin will increase exponentially in the coming years have come to light. But the rise in the value of Bitcoin is not the only reason investors are turning to it. Another reason they choose it is to offset the damage from traditional investment. According to a CNBC article , investors should turn to Bitcoin and non-US markets.
So it is clear that cryptocurrencies can and are already being used for investment purposes, as long as we follow some very basic rules .
- We never invest more than we can bear to lose
- We have to work with a plan and not impulsively or follow the crowd
- Emotion is an investor's worst enemy
- We are informed by many different sources before investing
- If something looks too good to be true, look no further
- We always have control over our cryptocurrencies - We never leave large sums of money in third party exchanges or services
- We take care of the security of our computer systems
- We keep a code file as well as notes
- Backup – Backup – Backup και… Backup!
Following these tips, we believe that anyone who uses a cryptocurrency as an investment will win.
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