Once the central bank in Cyprus froze bank accounts and limited the sum of money that might be withdrawn from bank accounts it created a huge uproar that was felt across the world. If consumers did not need use of money how could they buy and sell the things needed seriously to carry on in our modern world? The stark reality is they can not so consumers all over the world started to consider safer alternatives to fiat currency. Fiat currency is currency that’s no tangible value irrespective of what the government assigns to it.
Individuals are looking for a solution to store their buying power to safeguard themselves from having bank accounts frozen for indefinite periods of time. Lots of people started trading in Bitcoins. This is a crypto-currency this means it can’t be easily counterfeited but before anyone starts buying into this new currency it will be prudent to know the risks.
Bitcoins aren’t issued by any central bank or government so there’s no accountability whatsoever. If you are dealing with Dollars,Euros or Pounds you’ve the assurance that the government behind it will honor the debt while Bitcoins do not provide any guarantees at all. Buy bitcoin instantly The truth that nobody truly knows who made this currency so there’s no means of knowing whether maybe it’s stolen from under our eyes.
These Bitcoins are stored inside a digital wallet which can be encrypted on your own computer. While this will provide a sense of security if your computer is lost your Bitcoins are gone as well. It’s nothing like a credit card where you are able to get an alternative and carry on like nothing has happened.
Whilst the security with this currency is really a concern definitely the largest worry is the worthiness of it. The perceived value of a Bitcoin can alter in an instant and unlike fiat currencies which can be backed by hard assets owned by a nation if a Bitcoin value drops you’ve nothing of value at all.
There are a few exchanges all over the world that sell and buy Bitcoins, but you ought not find them thinking they are likely to rise in value. They are a digital commodity which some would classify as a “fad “.Tomorrow it might lose all its real value and never recover.
So to recap the risks, you do not have any real security with Bitcoins being that they are not provided by a government. The worthiness if highly volatile and might be reduced to zero in a heart rate and the straightforward proven fact that the currency has only existed for a couple years shows it is not demonstrated to be reliable.
If you are looking for a solution to preserve value then precious metals like gold,silver and platinum may be more beneficial since they’ve been employed for centuries as a moderate of exchange.
As it pertains to investing you need to never make rash decisions but weigh the risks and potential payoff and remember that there’s no sure things as it pertains to digital currencies like Bitcoins so approach at your personal risk.