Top Reasons for Investing in Cryptocurrency in 2020
For the last few years, cryptocurrency has taken the centre stage. People however still look at the topic with caution and have very little understanding of what exactly cryptocurrency is. They may be interesting to learn about, in the same way that you listen to news from a faraway country. However, most people aren’t thinking about trying to invest or trade in cryptocurrency.
Meanwhile, recent data shows that investing in cryptocurrency can be a very good idea. Just like any other investment with a potentially high return, cryptocurrency is risky. There are however very clear benefits attached to investing in crypto.
Cryptocurrency Offer Incredible returns
Truthfully, cryptocurrencies have been around for a relatively short time but so far, they are more profitable than most investments. For example, the highest return from a US stock is about 20%, which is considered a solid result. Cryptocurrency however tends to show wide changes in their prices over relatively short periods. It is risky – but high profits are never sure, and such potential is hard to find in other assets. Many people lose money in cryptocurrency trading because they try to do it without a specific strategy.
Cryptocurrency offers an Independent alternative
2020 so far featured a sort of stock market crash and economic decline. In this period, many investors ran into the hands of crypto. The crash and decline made cryptocurrency a safer alternative to more traditional investment solutions. There have been opposing theories on how cryptocurrencies would behave in the event of a crash. Especially since cryptocurrencies emerged after the 2008 crash (and as a reaction to it). But if there is anything 2020 has shown, it’s the fact that cryptocurrency will continue to thrive. Contrary to what many pessimists previously predicted.
Your money is yours alone
Cryptocurrencies offer you a level of independence impossible with other means. When you keep your money in a bank, you are at the mercy of other people and organizations. At any moment, your access to the money that is rightfully yours can be limited( robbed or go bankrupt).
With cryptocurrencies, your money is yours only and stays yours forever. You do not rely on financial institutions for holding or transferring it. You do not have to pay their exorbitant fees. In the long run, it can become the basis of a truly open and decentralized economy. By investing now, you can be at the forefront of it all.
Cryptocurrency has High liquidity
One of the primary characteristics of any asset is its liquidity. Liquidity in the sense of how easy it is to purchase or sell it at a price close to the market rate. By nature, cryptocurrencies have very high liquidity – you can quickly and easily buy and sell them. Also, the technological organization of trading platforms allows the use of a wide variety of tools and tactics. Tactics like limit-orders (automated buying and selling at a specified price) and algorithm-based trading.
Investing into stocks, bonds, or something else entirely, is traditionally complicated, bothersome, and time-consuming. Many investment opportunities (for example, real estate) have an extremely high entry threshold. You simply cannot just invest $100; you need a much more significant sum at your disposal to even get started.
However, cryptocurrency is a real sign of the times; both joining and taking part is simple. You do not have to deal with any institutions, sign papers, or visit banks. You simply create an account, get a wallet, and track all your assets with no effort at all.
If you do not have previous experience, profiting through day-to-day trading in cryptocurrencies will both lose your money and drive you mad. Price fluctuations happen daily. These fluctuations are usually more significant than what you may be used to with regular currencies. A much better solution is to invest for the long-term. Even when cryptocurrencies are going through a downward trend, forecasts are favourable. These forecasts show growth within two to five years. And when “growth” is used in relation to cryptocurrencies, it is often explosive.
The bottom-line is, just like any other potentially high-return investment, investing in cryptocurrency carry a particular risk. However, it is more than offset by the degree of independence they offer.