Should I invest in Bitcoin now? Why?

A bitcoin is worth exactly what people perceive its worth to be. While, in a sense, this is true of any currency, the value of a bitcoin is much more fickle than other forms of currency because of its unregulated nature. Banks are worried about the disruptive power of financial technology. Is now a good time to invest in cryptocurrency? First, As a currency, bitcoin has proven advantages. Its digital nature makes it hyper-portable, divisible, durable, and unconsumable. Its decentralization means that it isn’t beholden to the vulnerabilities of national currencies and is perfectly transferable across nations.

Bitcoin is a digital payment system with no intermediaries or banks; it was invented by a person or group using the alias Satoshi Nakamoto, and released as open-source software in 2009. The U.S. Treasury has categorized it as a decentralized virtual currency though some believe it is best described as a “cryptocurrency.” OxfordDictionaries.com helpfully defines cryptocurrency as “a digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank.”

 

Bitcoin has come a long way since being faced with resistance from both governments and potential consumers. The US Internal Revenue Service took action to discourage the use of bitcoins, by ruling that “general tax principles applicable to property transactions apply to transactions using virtual currency.” In practice, this means that the fluctuating value of bitcoins could trigger capital gains tax for consumers. There are a few primary concerns surrounding bitcoin that potential investors should be aware of. First, it is not backed or regulated by the good faith of a government or other entity. This stands in stark contrast to the dollar, yuan, pound, and other forms of currency used around the globe. So, many people view bitcoin as something akin to Monopoly money, because it is neither a fiat currency nor is it based on something of tangible value like gold.

If I knew investors who wanted to purchase a small, speculative position in bitcoin, I wouldn’t try to talk them out of it. However — and I cannot stress this enough — nothing should be invested in bitcoin currency that an investor isn’t comfortable losing.As bitcoin has a finite supply, future price movement will depend on demand, “Bitcoin will be used more in the future because it’s the first time that something not fully controlled by any entity like a government or bank has been used over the internet. It has been around for about Nine years now without any fundamental issues.”

Investors intrigued by the concepts of bitcoin and blockchain technology, but unwilling to take the plunge on such a speculative investmen, bitcoin mining and trading sites, may want to consider investing in one of the many financial and technology companies actively working to find other applications for blockchain. For investors who genuinely believe in the potential of bitcoin to become a major international currency, this may constitute an excellent time to invest in the currency. Historically low values coupled with some evidence of growth may spell promising outcomes. The only certainty in bitcoin investing is that it is a very speculative game, with the potential for major winners and losers.

 

You also Read:- Bitcoin,the first virtual currency that has the potential to turn the world economy on its head

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