Investing in crypto assets is risky, but it can also be incredibly lucrative. If you want to obtain direct exposure to the demand for digital currency, cryptocurrency is a good investment. Buy bitcoin equities of firms with bitcoin exchange is a safer but potentially less rewarding option.
Risks associated with cryptocurrencies:
More than stock markets, Cryptocurrency exchanges are prone to hacking and other forms of criminal behavior. Investors who have had their digital currencies stolen have suffered significant losses due to security breaches, prompting many exchanges and third-party insurers to begin offering hacker protection.
Cryptocurrencies are much more difficult to store safely than equities or bonds. Cryptocurrency exchanges like Coinbase (NASDAQ: COIN) make buying and selling crypto assets like Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH) relatively simple. Still, many people prefer not to keep their digital assets on exchanges due to the risks of allowing any company to control access to their assets.
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Adoption of cryptocurrencies:
Cryptocurrencies and the blockchain business are growing stronger despite the risks. Investors can obtain institutional-grade custody services as much-needed financial infrastructure is being constructed. Professional and individual investors gradually gain access to the tools they need to manage and protect their cryptocurrency holdings.
Many firms are gaining direct exposure to the cryptocurrency sector and developing crypto futures markets. Block (NYSE: SQ) and PayPal (NASDAQ: PYPL), two financial behemoths, are making it easier to buy and trade bitcoin on their famous platforms. Block and other firms have invested hundreds of millions of dollars in Bitcoin and other digital assets. In early 2021, Tesla (NASDAQ: TSLA) purchased $1.5 billion worth of Bitcoin. By February 2022, the electric vehicle manufacturer claimed to have amassed a significant amount of cash.
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Is cryptocurrency a good long-term bet?
Many cryptocurrencies, such as Bitcoin and Ethereum, are founded with ambitious goals that can be accomplished over long periods. While the success of any cryptocurrency project cannot be guaranteed, early investors in a cryptocurrency project that achieves its objectives can be rewarded handsomely in the long run. Any crypto exchange initiative must first achieve widespread adoption as a long-term success.
As a long-term investment, Bitcoin:
Because Bitcoin is the most well-known cryptocurrency, it benefits from the network effect, which means that more people want to acquire it because it is the most popular. Many speculators regard Bitcoin as “digital gold,” but it might also be a digital form of money.
Because the quantity of bitcoin is fixed, unlike the supply of fiat currencies like the US dollar or the Japanese yen, investors believe the cryptocurrency will appreciate over time. Bitcoin’s supply is limited to less than 21 million coins, whereas conventional currencies can be created at the discretion of central bankers. Many investors believe that when fiat currencies decrease, Bitcoin price will appreciate.
Should you put money into cryptocurrencies?
Owning bitcoin can help diversify your portfolio because cryptocurrencies like Bitcoin have traditionally had low price correlations with the stock market in the United States. If you believe that cryptocurrency use will grow in popularity over time, it’s probably a good idea to invest in some crypto as part of a balanced portfolio. Make sure you have an investment thesis for each cryptocurrency you buy. This will help you understand why the currency will last. You should be able to manage investment risk as part of your whole portfolio if you do your study and learn as much as possible about how to invest in cryptocurrencies.
KuCoin is a big cryptocurrency exchange that allows users to buy, sell, and trade digital assets. The platform also enables margin, futures, and peer-to-peer (P2P) trading and conventional trading choices. Users can also earn incentives by staking or lending their cryptocurrency. KuCoin has cheap trading fees compared to some of its competitors, making it an appealing alternative. You can also view the live chart trading pairs, such as, BTCUSDT and ETHUSDT from KuCoin trade page.