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Is it worth investing in cryptocurrencies?
There are many people today who show interest in bitcoins and cryptocurrencies, these being increasingly seen as a digital alternative to traditional exchange methods such as cash or credit cards. That’s why today we want to help you understand if investing in cryptocurrency is a good option.
Beyond their intrinsic characteristics, which make them a very useful and potentially disruptive tool, cryptocurrencies have always generated different viewpoints and debates about their ‘goodness’ and ‘usefulness’.
There are those who believe that cryptocurrencies have been created as a financial means to favor scammers, terrorists and criminals, especially given their involvement in ransomware scams and trading on the Dark Web.
On the other hand, recent increases in the value of Bitcoin have established cryptocurrency as a good investment that, thanks to the blockchain technology that supports it, can have a positive impact on the portfolios and trading practices of mainstream investors, worldwide.
Advantages of cryptocurrencies: why invest in cryptocurrencies in 2020
In this paragraph we will examine the most positive aspects and advantages of cryptocurrencies that make them a good alternative to more consolidated forms of financial trade.
Eliminate the intermediaries
In traditional business relationships there are significant complications and expenses to what should be a simple transaction. Brokerage fees and other special conditions may be charged.
One of the advantages of cryptocurrency transactions is that it is a one-to-one business, taking place on a peer-to-peer network structure that eliminates intermediaries.
This leads to greater transparency, clarity and speed in transactions.
Make transactions more confidential
With traditional cash/credit banking systems, the history of transactions made can become a reference document for the bank every time a transaction is made. This may involve checking your account balances to ensure sufficient funds are available, as well as a review of your financial history.
One of the great benefits of cryptocurrency is that every transaction you make is a unique exchange between two parties. The exchange of information that is transmitted takes place on a “push” basis, whereby you can transmit exactly what you want to send to the recipient and nothing else.
This protects the privacy of your financial history and protects from the threat of account or identity theft, which is greater with the traditional system, where your information can be exposed at any point in the transaction chain
Reduce transaction fees
If you have a bank account, every time you look at your bank statement you will notice those items in red – the commissions that are applied every time you do an operation- that erode little by little your balance.
Transaction fees can greatly reduce your resources, especially if you perform many transactions in a month.
Because the data miners (remote computer systems) that generate Bitcoin and other cryptocurrencies receive their compensation from the cryptocurrency network, transaction fees are usually not applied.
There may be some outside commissions involved if you use a third-party management service to maintain your cryptocurrency portfolio or to buy cryptocurrency, but they are certainly much lower than the transaction costs incurred by traditional financial systems.
4. Facilitate access to credit
There are currently an estimated 2.2 billion people around the world who have access to the internet or mobile phones, but currently lack access to traditional banking systems. Digital data transfer and the Internet are the media that facilitate the exchange of cryptocurrencies. So these services are potentially available to anyone with a data connection, some knowledge of cryptocurrencies, and access to relevant websites and portals.
5. Guarantee the exclusive ownership of the owner
In traditional banking systems, the user transfers the management of his funds to a third party.
One of the biggest benefits of cryptocurrency is that, unless you have delegated the management of your wallet to a third party service, you remain the sole owner of your wallet’s private and public keys, which make up the identity of your cryptocurrency network.
6. They adapt to your needs
Today there are around 5,000 cryptocurrencies or altcoins in the market and many of them have been created for specific use cases, favoring the flexibility of the cryptocurrency phenomenon
For example, there are “privacy coins”, like Monero, that help to hide your identity on the blockchain and tokens like Ripple that helps existing financial systems to improve their capabilities for global transactions, thanks to its technology.
7. Guarantee security and privacy
The technology that is the basis of cryptocurrencies, used in all processes of distributed registry (blockchain) and cryptocurrency transaction, is a safeguard against fraud and account tampering and above all are a guarantee of consumer privacy.