The growing demand for digital currencies means that not only people from the world of finance are interested in the crypto industry. If you add to this significant increases in prices and interest rates of loans resulting from inflation, the crypto market appears to be prospective also for people with no investment experience. Because money matters to everyone. However, is investing in cryptocurrencies actually a good idea? If so, at what point should you decide on them?
The answer to the second question is simple. Investing in cryptocurrencies should be preceded by gaining knowledge and basics of the operation of these specific financial instruments. Understanding the reasons behind the success of cryptocurrencies makes it easier to analyze them in terms of financial potential.
Investing in cryptocurrencies – where did the phenomenon of electronic money come from?
Their beginning dates back to October 31, 2008, when a man (or group of people) hiding under the pseudonym Satoshi Nakamoto published a manifesto on the Internet entitled “Bitcoin: Peer-to-peer electronic money system”. It describes the methodology for using the P2P model (a computer communication infrastructure without a central administrator, operating from “person to person”). This was to allow the design of a system to perform “trusted” electronic transactions with the use of virtual currency.
Bitcoin, the name of which refers to both cryptocurrency and P2P networks, is an asset with no physical equivalent. Its value is reflected in fiat currencies, i.e. legal tender in a given country. It can be compared to a portfolio that stores data on the holdings of specific units. The implemented technology of a distributed database based on a blockchain (called blockchain) allows you to give control over the wallet to only one person. We are talking about the holder of a dedicated key/password consisting of a random sequence of characters and numbers.
Officially, bitcoin began operating on January 3, 2009, with the launch of its network. It was then that Satoshi Nakamoto, using computers with high computing power capable of solving complex mathematical puzzles, “dug up” the first block of bitcoins. The portfolio held was 50 BTC. A few months later, on October 5, an analysis of the cost of mining the block showed that one US dollar allows the purchase of 1,309 BTC. When bitcoin was listed on the Mt.Gox crypto exchange on August 17, 2010, it was valued at $ 0.063. Nevertheless, over the years and stock market corrections, this price has changed, and by April 2021 it reached the value of about PLN 65,000. dollars for 1 BTC. So, in retrospect, is it worth investing in cryptocurrencies? We leave this question to you.
Investing in cryptocurrencies – how to start?
A cryptocurrency transaction can be concluded in several ways. The most popular is the use of the cryptocurrency exchange services. This platform allows you to trade conveniently after registering your account for free. The process is as simple as possible and usually takes no more than a few minutes. At the same time, in the case of most exchanges, it will be necessary to provide personal data and verify the user’s identity. This is how you will start your adventure with investing in cryptocurrencies.
However, the usefulness of the exchange is not limited only to the infrastructure responsible for the execution of orders and the implementation of subsequent cryptocurrencies on the market. It is also an investment platform with trade tracking, price tracking and chart analysis. The more data we have about coins, the safer investing in cryptocurrencies.
How much do you have to invest in cryptocurrencies?
In the case of cryptocurrencies, it is possible to acquire their fractional value, unlike traditional stock exchange shares. This is why you do not need to buy “all” bitcoin worth tens of thousands of dollars, which opens the door for people with much less capital.
Is it worth investing in cryptocurrencies?
A characteristic feature of digital assets is their ability to generate large profits over a specific time perspective, which definitely speaks in favor of investing in cryptocurrencies. On the one hand, the instability of cryptocurrencies is mentioned many times, but on the other hand, it opens the door to making a lot of money in a relatively short time.
Investing in cryptocurrencies is not everything, however, as cryptos are treated as deflationary assets. Thanks to this allocation of funds, we “protect” ourselves against excessive spending of money and protect ourselves against inflation.
Attention! The first 10 people who make a transaction at the exchange office using the KANGA code will reduce its value by 0.5%! Find the nearest Kanga exchange office!