If you are wondering what Bitcoin is and whether you should invest in it, then this article is for you. In 2010, the value of one bitcoin was only 5 cents. Fast forward to 2017 and it’s worth $20,000. Again, the price fell to $8,000 within the next 24 hours, thus causing a huge loss to currency holders.
If you are trying to learn more about Bitcoin, this read may help you. According to statistics, about 24% of Americans know what this thing is. However, the currency still has a value of over $152 billion. This is one of the most common reasons for the popularity of this thing. Let’s find out what it is and whether you should invest in it.
What is Bitcoin?
In simple words, Bitcoin is one of the digital currencies. Digital currency is known as cryptocurrency. The term was coined by an anonymous person during the 2008 financial crisis.
A digital currency account is kind of like your checking account that you can view online. In other words, it is a digital currency that can be looked at but not touched. In the case of Bitcoin, you also have no physical representation. All money exists only in digital form. There is no one to regulate this type of currency. Likewise, the network is not controlled by any single entity and tokens are exchanged between individuals through a complex software system. Instead, everything is decentralized and managed by a network of computers.
It is important to note that you cannot use these tokens to pay for anything you want to buy. In fact, you can only use it to buy from certain sellers or stores online. But it can be sold for traditional currency or money. However, more and more companies are starting to accept Bitcoin and other cryptocurrencies. For example, Expedia and Over-stock accept it from consumers. One of the main characteristics of this type of money is that the transaction is completely private and cannot be traced. This is one of the many reasons why most people prefer this digital form of money.
Should you invest in Bitcoins?
Remember: before choosing to invest in Bitcoin or any other digital currency, make sure you understand the risks associated with this system. Volatility is one of the main risks. This means that the value of your money can fluctuate significantly in 24 hours. In fact, the rise or fall in value can be as much as 30%. Another problem is that most of the digital currencies that can be seen today will lose their value within 5 years, according to most experts.
For greater security, we suggest you only invest what you can afford to lose. For example, if you have $1000, you can invest $10. And if you lose this amount, it will not create any financial problems for you.
Hopefully you now know what Bitcoin is and whether you should invest your hard earned money. Remember: you don’t have to invest a lot of money or you could get into serious financial trouble down the road.