If you are wondering what Bitcoin is and if you should invest in it, this article is for you. In 2010, the value of a bitcoin was only 5 cents. Fast forward in 2017 and its value has reached $ 20,000. Again, the price fell to $ 8,000 within 24 hours, causing a huge loss to the currency holders.
If you have tried to learn more about Bitcoin, this reading can help you. According to statistics, about 24% of Americans know what it is. However, the currency still has a value of more than 152 billion dollars. This is one of the most common reasons for the popularity of this thing. Let know what it is and if you should invest in it.
What is Bitcoin?
In simple terms, Bitcoin is one of the digital currencies. A digital currency is called cryptocurrency. The term was coined by an anonymous person during the 2008 financial crisis.
A digital currency account is an account similar to your current account that you can view online. In other words, it is a digital motto that can be viewed, but can not be touched. In the case of Bitcoin, you have no physical representation either. All money only exists in digital form. Nobody is there to regulate this type of currency. In the same way, the network is not managed by any entity and the tokens are exchanged between individuals via a complex software system. Instead, everything is decentralized and is managed by a network of computers.
It is important to note that you can not use these tokens to pay for everything you want to buy. In fact, you can use it to buy only from some sellers or online stores. But it can be sold for traditional currency or money. However, more and more businesses are beginning to accept bitcoin and other cryptographic currencies. For example, Expedia and Over-stock accept users. One of the main features of this type of currency is that the transaction is totally private and can not be found. This is one of the many reasons why most people prefer this form of digital money.
Should you put money in Bitcoin?
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 major risks. This means that the value of your money can fluctuate considerably in 24 hours. In fact, the rise or fall in value can reach 30%. Another problem is that most of the digital currencies that we can see today will lose their value in five years, according to most experts.
For added security, we suggest investing only to the extent that you can afford to lose. For example, if you have $ 1,000, you can invest $ 10. And if you lose that amount, it will not create financial problems for you.
If all goes well, you know what bitcoin is and if you have to invest your hard earned money. Remember: you do not have to invest a lot of money, otherwise you risk to have serious financial problems in the future.