Many people consider Bitcoin and cryptocurrency to be pretty risky. From volatile prices to unstable markets, lack of proper regulation, susceptibility to cybersecurity breaches, and the list goes on and on—investing in cryptocurrency may look like a complete waste of money. The irony is that we keep hearing reports of people who make millions overnight from trading in digital currencies. So, what's the truth; is cryptocurrency a good or bad investment?
Here's the thing—investing in cryptocurrency can make you filthy rich, but you can also lose a lot of money. It's potentially extremely profitable and risky at the same time. But isn't that the nature of every business? Yes, every trade involves assessing risks and finding ways to bypass them to make profits, and cryptocurrency is no exception. The only difference is that cryptocurrency's potential gains and losses are incredibly high, calling for greater caution before making any trading decisions. But what if there were an emotionless robo advisor to help you along the way…?
Cryptocurrency can be a good and profitable investment if you understand the business. The first thing every crypto trader must do is understand the potential risks and ways to avoid them.
Here are some common cryptocurrency risks and ways to bypass them:
One of the most common concerns among crypto traders is the instability of the digital currency market, leading to extreme price fluctuations. The volatility can be a good and bad thing. The positive side is that it can enable you to make colossal instant profits, and the trade-off is that you can equally make significant losses from sudden drops in price. Volatility also makes the prediction and making of market decisions pretty challenging.
The solution is to invest in established cryptocurrencies like Bitcoin, Ethereum, and Chainlink. They may not be as stable as traditional trading assets like stocks but have a relatively higher level of predictability. You might also want to be patient and highly cautious before buying or selling any crypto. But what if there were an emotionless robo advisor to help you along the way…?
The other challenge you may encounter is a lack of buyers due to low trading volumes, especially when crypto values skyrocket. This issue is particularly prominent among first-time traders and even some experts who do not know when to Sell or Buy tokens. The solution is to use a cryptocurrency trading robo advisor that monitors the market and automatically gives you Buy and Sell Indicators to maximize profit and minimize loss.
Cryptocurrencies are generally unregulated in most countries. The regulatory unclarity may lead to future bans and a lack of public trust in digital currencies. Fortunately, most states and countries have started considering regulating the business. Last year, Congress introduced over 30 bills on cryptocurrency regulation. The United States of America has an amazing opportunity presented to them. Economies worldwide are gradually embracing Bitcoin and other cryptos and looking to integrate them with traditional financial services.
Cryptocurrency is a new worldwide industry with a promising future. For instance, if you bought 100 Bitcoin in 2010 and never sold, you could have been a billionaire today. So, yes—cryptocurrency is a good investment. All you need to do is research widely, zoom out, and consider all the potential extremes before making any trading decision. But what if there were an emotionless robo advisor to help you along the way…?