3. Is it safe to invest in Cryptocurrencies?
This article will touch on the pros and cons of Crypto investment. Let’s start off with the pros.
Cryptocurrency market is around 8 years old with market cap of around 300 billion dollars (as of 19 Mar 2018) .which accounts for less than 1% of total world GDP. It is stated at global forum that 10% of the world GDP will be in cryptocurrency by 2025. Scroll down more to know why.
Why Cryptocurrency and Blockchain are better than Fiat currency:
Still in its infancy. Investors can get high returns from young products with successful technologies.
Limited supply and inflation proof, can’t be forged and duplicated by government or any cartels which will lead to currency value plunge or inflation. That is not true for Fiat currencies.
Electronic purchase online with fiat currency can result in fraud. But crypto transactions are done on a highly secured blockchain public ledger using cryptography without the need to go through a middle man or a centralized institution.
Cryptocurrency can eliminate third parties transaction costs and risks
Faster (Time is more valuable than money)
Decentralized cryptocurrencies are free from the control of governments and any organizations.
Established cryptocurrency and blockchain for example Bitcoin itself is almost impossible to hack as the blockchain technology that forms the basis of the currency is constantly reviewed by other blockchain participants and nodes. However, just because Bitcoin itself isn’t hackable does not mean it is completely safe to use. Similar to the process of banking, trading of Fiats, investing in current securities - like stocks ,bonds ,mutual funds etc. , there are some risks of frauds and vulnerabilities, which will be advised and covered at articles below.
Crypto Security Best Practices
Avoid placing all your investment eggs into one basket, diversify your investment money to example, cryptocurrencies, properties, bonds, stocks etc. Diversification is one of the key recommendations offered by professional investors to reach long term financial goals while minimizing risk.
Always activate 2FA for transactions. When processing a transaction, a notification will be sent through to a linked cell phone number or an authentication app in order to validate the person that is requesting the payment is you.
Do not talk publicly online about cryptocurrency, especially on social platforms such as Twitter, Facebook which use your email address to identify you.
Be vigilant and lookout for suspicious activities on your cell phone or desktop especially those involving notifications of a SIM swap or port.
When possible, always store most of your coins in an offline wallet not connected to the internet and lock it safely away.
Avoid trading in centralized small unregulated crypto exchanges, and use decentralized exchanges that do not hold users’ funds.