You must be well versed in online banking systems and digital money and know-how to transfer money online from one bank to another. Cryptocurrencies can be defined as a type of fiat currency but with some differences. Bitcoin is created through a code that consists of numbers and letters. Cryptocurrencies like bitcoin, ethereum and so on all use blockchain technology to transfer data. Also, there is a limited number of bitcoins i.e., 21 million. Cryptocurrencies use a decentralised system because the mining power is not in the hands of any particular authority. If you want to know more about investing in cryptocurrencies then you can visit the bitcoin prime platform. If you would like to have more information about investing in cryptocurrency then you may visit Bitcoin Future.
Drop in the value of bitcoin
The value of Bitcoin and many other cryptocurrencies have faced a downfall in December 2022 and are still suffering from it. The value of bitcoin has decreased from $69,000 in November to $23,000 in June. The reason behind this fall is:
- Increasing fluctuations in the rate of interest in the US and the Uk forced the people to sell risky assets.
- China banned the use of cryptocurrencies.
- Rumours started to spread that Russia may also ban the use of cryptocurrency which made the prices fall.
Should the investment be made in Bitcoin?
Before investing in Bitcoin there’s something that you should know. Bitcoin’s prices keep fluctuating and if you are ready to bear the risk then you should be well aware of crypto and have a proper strategy. Also do not invest in Bitcoin just because you have fear of missing out. You should have proper knowledge of what you are investing in and also check the risk related to the investment. Things that you may think about before investing in crypto are:
- You don’t invest your life-saving in crypto as there’s a huge risk related to it.
- Only invest the amount as much you can afford to lose.
- Investing in cryptocurrencies is more like gambling.
- Investment in cryptos should be treated as a long-term asset.
Can all your money be lost in crypto?
Yes, it can. Cryptocurrency involves high risk and its price keeps fluctuating. According to a report it has been noticed that around 20% of the Bitcoin has been lost or forgotten which values around $140 million. As it is a digital currency, it also involves the risk of hacking and scams, according to Atlas VPN, Bitcoins of value $ 10 million are hacked or scammed every day.
Some people minimise the risk of hacking and cyber attacks by keeping their bitcoin data stored on their hard drives and USB. You should not invest all your money in Bitcoin, instead, you should spread your money around different businesses.
Fees related to the buying of Bitcoin.
Before investing in bitcoin you should know that there are various types of fees related to the transaction of bitcoin such as Transaction fees, Deposit fees, Withdrawal fees and Escrow fees. These are charged according to the percentage of the transaction value. It increases the total payment money.
Ban on cryptocurrency in China
China has banned the use of cryptocurrency and made it illegal since 2019. The cryptocurrency was banned because it will stop money laundering and also ensure the safety of people’s assets. All the organisations were banned from giving any kind of crypto service. It was announced by three governmental organisations that no protection will be provided to the investors on the loss of money in crypto.