Bitcoin is a digital currency on the Internet, like the dollar or the pound, but with a few exceptions. Introduced by Satoshi Nakamoto in 2009, bitcoin is included in a payment system where there are no intermediaries and goods can be securely transferred between two people on the planet. This is due to a heavy network of computers, and a unit of currency for a bitcoin system (called Bitcoin) can simply be purchased by joining an extensive network. Bitcoin provides a quick cheap and secure alternative to transactions, but few are willing to go for it. So the million-dollar question still remains, is bitcoin a safe investment?
Bitcoin is just a few years old, it’s an interesting creature that has impressed many, and, according to the protocol, has won a name in the top financial charts. Its popularity has increased, and this has led some of the best companies, such as Virgin Galactic, to consider it an acceptable source of payments. Bitcoin prices are rising at rates of up to 10% and continue to dominate as an alpha market, and this has made many interested in investing in it.
Another feature of bitcoin is that it does not have a central bank and does not control its central government. It is a global currency, and its creation and existence lies behind a complex and intricate mathematical algorithm that allows it to cover up government failures. Cases of political instability and government absurdity, which worsen the economy to disgrace and lead to years of investment in the currency, are not found in the cryptocurrency system. This creates safe and friendly investment opportunities with low inflation.
With the ever-rising rise of cryptocurrency also has its downsides. As mentioned, it still makes baby steps; and with it the great uncertainty. Bitcoin prices are volatile; now increases sharply and can range from 30 to 40% over the course of a month. The world is still amazed by its appearance, and owners of bitcoins and bitcoins are very few. This leads to unanswered questions and cold fear among people, as investing in a new unpredictable “gold mine” can have devastating consequences. Its novelty leads to a lack of regulations and scares away potential investors.
The mystery surrounding the bitcoin system is a major factor to consider. Anything can happen and all bitcoin market participants are on high alert. China in December 2013 ruled out the use of bitcoin, and this led to a sharp drop in its value from 1,240 to 576 dollars in just three weeks. Programmers also determine the functionality of this world currency, and many are skeptical of risking their finances for some group of geeks. This prevents many from taking risks in the system and increases the risk of investing in bitcoin.