01
Advantages and disadvantages of investing in cryptocurrencies
Advantage:
1 High transparency
The creation of cryptocurrency is based on the blockchain, and we can view all transactions on the blockchain, because when we make any type of transaction, it will be saved in the blockchain and our transactions can be checked at any time. It cannot be changed by us. It always shows our real statistics. It applies to everyone and anyone can view it at any time. No organization or personnel can change them. Therefore, it is completely transparent and regarded as the safest feature.
2 Stay away from inflation
Currencies around the world are facing inflation because the government prints a lot of money, and then they face inflation, but this is impossible in cryptocurrencies. When any kind of new currency is issued, it has already been decided how many cryptocurrencies to develop. When it is fixed once then no one can exceed them. Like Bitcoin, only 21 million Bitcoins can be mined, and no one can increase its amount. Therefore, our currency is always far away from inflation.
3 Convenient transmission
When traditional currencies are transferred between the two countries, they will go through multiple hurdles, which are often affected by the policies and laws of various countries and regions, and there are many restrictions, making the entire transfer process time-consuming and poor experience. Encryption currency can enable users in different countries and regions in the world to achieve efficient transmission.
3 Safer
We all know that we can check all transactions with the help of blockchain. All transactions are conducted through anonymous identities, so we can easily track whether there is any fraud or theft. It is more secure than real money.
Disadvantages:
1 Unrecoverable if lost
If the private key of encrypted currency is lost, there is no customer care support. If it is lost, then you cannot recover it. Until now, there are many lost cryptocurrencies and no one can access them. We should always store our private key in a drive that is not connected to the Internet, because if it is connected to the Internet, then we may lose the password. If your private key is stolen or you forget the private key, it means that the encrypted currency is lost and cannot be recovered.
2 Market volatility
When y ou want to invest in cryptocurrency, we can sell and buy it. It is like a commodity, we can easily buy and sell it. Its price may rise or fall at any time, so it is as risky as the stock market. According to market conditions, its price will change over time, so be prepared at any time. Its price may rise suddenly, and may fall suddenly. Therefore, its price fluctuates according to the market.
3 Limited circulation
With the improvement of the electronic payment system, the liquidity of demand deposits is almost equivalent to cash. However, virtual currency can only be circulated within a specific range, with poor liquidity, and it is difficult to form current purchasing power. Therefore, virtual currency is more of an investment product than a currency capable of performing currency functions.
02
Which cryptocurrency should be invested in?
Not all virtual currencies are worth investing in. The following virtual currencies have the most development potential and worth investing in.
Bitcoin (Bitcoin/BTC)
Bitcoin was born in 2008, not only the starting point of virtual currency, but also the most popular virtual currency now. So far, Bitcoin not only has the longest history, but also has the largest development and investment community. In the mainstream economy, the acceptance of Bitcoin is also getting higher and higher, and some well-known companies in the world have begun to accept Bitcoin as payment. It can be said that Bitcoin has a bright future and it is the king of virtual currencies.
Ether (Ethereum/ETH)
Ether is the second virtual currency in market capitalization after Bitcoin. In fact, Ether is not only a virtual currency. With the support of “smart contract” technology, Ether has become the local currency for transactions of all applications of the Ethereum blockchain, and the intermediary is completely removed in the transaction process. This is also the key reason why investors believe that Ether is stronger and have confidence in its price.
Bitcoin Cash (BCH)
Bitcoin Cash has been independent from Bitcoin in 2016. As a branch of Bitcoin, Bitcoin Cash not only has all the advantages of Bitcoin, but also solves the low scalability, high transaction costs and slow transaction speed of Bitcoin. And other issues. Although Bitcoin Cash has been generated for a short period of time, it is still in the early stage and the market is not very accepting of it, but I believe that after a period of development in the future, Bitcoin Cash will definitely provide investors with a satisfactory answer.
Litecoin
Litecoin-Litecoin (LTC) Litecoin was founded in 2011 by former Google employee Charlie Lee. Litecoin is built on the basis of Bitcoin’s blockchain to optimize and improve. Therefore, like Bitcoin, Litecoin is only a digital currency and does not provide smart contracts similar to Ethereum. However, Litecoin is 8 years old and has withstood the test of time. It has also become one of the most popular currencies in the cryptocurrency market.
Ripple (XRP)
Ripple was established in 2012 and has been focusing on the field of international payment and transfer. The total amount of Ripple is 100 billion, of which 50 billion is owned by Ripple Labs. This is different from other cryptocurrencies. In fact, almost mainstream cryptocurrency centers do not have many currencies.
03
The easiest way to invest in cryptocurrencies: CFDs
The Contracts for Difference / CFD is a contract between investors and the settlement of transactions.
Investors do not actually have the target assets stipulated in the contract, but only forecast the future of the target assets.
Special features of CFD:
Easy to use. When investors trade cryptocurrencies with CFDs, they will not involve the actual ownership of the gold, so they can avoid complicated transaction procedures.
Two-way profit opportunities. CFDs allow investors to trade the future price of cryptocurrencies from both long and short directions. The rise or fall of the future price will not affect your profit from the difference between the price and the current price.
The threshold is low and the return is high. CFDs implement a margin trading system, using the principle of leverage, you can use a small amount of funds to conduct large transactions, and at the same time obtain higher returns under the magnification of leverage.
The number of trading lots is small. The size of a standard Bitcoin CFD is 1 lot, but you can start trading with a minimum of 0.01 lot.
One trading account invests in multiple products. After investors open a CFD account on the trading platform, in addition to gold, you can also invest in nearly a hundred popular investment products such as foreign exchange, commodities, and cryptocurrencies.
Break through time and space constraints. CFDs are open to traders 7*24 hours, and investors can complete all trading operations at any time through the Internet without leaving their homes.
