One of the most discussed topics in 2020 in the financial industry is investments, as more people are starting to take their finances seriously when exploring options to earn more income. This has led to the large increase in cryptocurrency investments and trading in 2020. There are now more consumers with over 40 million people worldwide using some form of cryptocurrency. Bitcoin currently accounts for $ 6 billion of daily transactions and the current market cap is $ 144.96 billion. The size of the global blockchain market is expected to reach $ 57 million by 2025.
While there may be a lot of noise about bitcoin trading today, you must be familiar with the pros and cons before getting started.
PROS
Free to Pay
This is one of the most important benefits of using bitcoin and why many more people continue to embrace it as the preferred payment method. Unlike the traditional banking system, bitcoin allows you to pay someone else within seconds regardless of their location. Unlimited transactions from the comfort of your home would save you time, effort and money. This is possible with bitcoin as there is no governing body or third party organization involved.
Transparency of Transactions
Blockchain technology makes it easy to validate all transactions. This ensures that all final transactions are accessible to the public eye but any personal or sensitive information will be hidden to preserve your anonymity and prevent your transactions from being traced back to you. This transparency helps improve bitcoin security since no one can handle it.
Low Trading Fees
One of the barriers of traditional bank payments is transaction cost, which is always on the high side when sending across borders. However, bitcoin has relatively lower trading fees, especially for high-value transactions. This benefits many companies and investors and most importantly, small business owners and short-term traders.
CONS
Risk and Volatility
One of the biggest issues with trading and investing in bitcoin is the level of risk and volatility involved. Bitcoin is considered a high-risk asset, as the price tends to change over time, depending on several factors. This volatility can be both an advantage and a disadvantage, because the price could go very high and you earn a lot or it decreases and you lose a huge part of your money. This is why it is often advised not to trade or invest more money than you can drop out of, should anything happen.
Safety and Theft Risk
Security issues are everywhere and continue to rise as technology improves. With bitcoin being a digital currency, consumers are not free from theft or fraud. However, you can always work around this by ensuring a safe security practice.
To get the most out of bitcoin trading, make sure you use the right bitcoin wallet or exchange. There are many things to look for when choosing a platform but security should be a priority. You can also look for reviews about it online, like how Inside Bitcoin reviews Bitcoin System. With more reviews from past and present users, you will be able to make an informed decision.