Bitcoin is an online digital currency, just like the dollar or the pound, but with a few exceptions. Introduced by Satoshi Nakamoto in 2009, Bitcoin is included in a peer-to-peer payment system in which there are no intermediaries and goods can be safely transferred between any two people on the planet. It is connected to a heavy network of computers, and the unit of currency for the Bitcoin system (aptly named Bitcoin) can be easily obtained by joining a wide network. Bitcoin provides a fast, cheap and secure alternative to transactions, but few are willing to do so. So the million-dollar question still remains, is Bitcoin a safe investment?
Bitcoin is only a few years old, an interesting creation that stunned many and noted that it gained a name on the highest financial charts. Its popularity has grown and has led some of the leading companies like Virgin Galactic to consider it an acceptable source of payment. Bitcoin prices are rising at rates of up to 10% and continue to dominate as alpha markets, and this has attracted many to invest in it.
Another special feature of Bitcoin is that it has no central bank nor is it controlled by the central government. It is a global currency and its creation and existence stands behind a complex and geeky mathematical algorithm that allows it to overshadow government disasters. Cases of political instability and government absurdities that bring the economy to shame and lead years of investing in currency downstream do not occur in the cryptocurrency system. This creates a safe and friendly investment opportunity with low inflation risks.
With the always amazing upside down, cryptocurrencies also have their downsides. As mentioned, this thing is still taking childish steps; and with that comes great uncertainty. Bitcoin prices are volatile; it is currently growing rapidly and can range from 30% to 40% in a month. The world is still surprised by its appearance and there are very few owners of Bitcoin and Bitcoin. This leads to unanswered questions and cold fear among people, as investing in a new unpredictable ‘gold mine’ can have devastating effects. Its novelty brings a lack of regulations and scares potential investors.
The puzzle around the Bitcoin system is a major factor to consider. Anything can happen and everyone participating in the Bitcoin market is on high alert. China eliminated the use of Bitcoin in December 2013 and this led to a drastic drop in its value from $ 1,240 to $ 576 in just three weeks. Developers also determine the functionality of this global currency and many question the thought of risking their finances for some group of geeks. This prevents many from entering the system and increases the risk of bitcoin investing ever so high.