Since the creation of the first cryptocurrency (Bitcoin), cryptocurrencies have seen a great surge in popularity and investment. Today, the cryptocurrency market is valued at 400 BILLION DOLLARS, thats even higher the GDP of Norway. If cryptocurrency is a country, it would be ranked the 29th country in terms of GDP. With such a vast amount of wealth invested in the cryptocurrency market, many wonder the pros and cons of cryptocurrency compared to average money.
Pros:
Cryptocurrency is transparent
With Bitcoin, there is an open ledger called a block chain on which all transactions are recorded and monitored. Because of this, once a transaction is completed and recorded on the ledger, it cannot be changed. Transactions are available for verification by anyone and anytime. No one person or organization can manipulate it and therein lies [the biggest security feature
Trade can be done anonymously
Transactions done through cryptocurrency are untraceable as only your wallet address will be displayed on the block chain, while your identity and details are not. This is a great breakthrough as your privacy will be secured, there wont be any third party that will be able to "stalk" your transactions.
Portability
Unlike physical money, large amounts of cryptocurrency can be transported easily without detection. It is possible to carry billions of dollars in Bitcoins in a memory drive on your person, though not advisable.
Cons:
Cannot be recovered if lost
Unlike banks that have you covered in case of a security issue like a hacking or stolen credit card, Bitcoins are not retrievable if they’re lost. There are currently no mechanisms to recover lost Bitcoins. According to several people, the best way to store Bitcoins is on a drive that is not connected to the internet. This is because they are encrypted for security purposes. The encryption identifies the currency, but not the owner. Whoever has the codes owns the currency and this anonymity feature means stolen coins are lost – that is unless you can steal them back!
It is subject to market fluctuations
When you want to invest in cryptocurrency, keep in mind that while it can be used to buy and sell, it is also a commodity like oil which is subject to changing market prices. When investing in cryptocurrency, it’s best to look at it as a long-term investment and not let momentary fluctuations in price make you think you’ve made a bad investment.
Knowing all of these details.Does the cons outweigh the pros? Is taking the risk worth it? I believe that at the end of the day that choice is up to you. But looking at the growth of the cryptocurrency market, the value has almost only gone up and it looks to continue doing so in the future. Buying a chunk of Bitcoins now to sell at a later time when the value has appreciated satisfactorily looks like a wise decision. Unlike saving regular money that will be decimated in time by inflation, cryptocurrency is looking up – at least in the foreseeable future.
