There is no escaping that cryptocurrency can be a relatively unpredictable investment. When you consider the crash that happened in 2022, the evidence is clear that the value of tokens is prone to peaks and troughs, like any other stock or bond out there.
So, why do people continue to use it? If it has proven to be volatile and that there is risk involved in such an investment, why is it still so popular? The simple answer is that several different benefits come with investing in and using cryptocurrency. These are all going to be discussed in a bit more detail below. Continue reading to learn all about it.
The Speed of Transactions
If you were to use regular wire transfers to send money in the United States or across the world, then thanks to different checks and balances put in place by banks, there could be major delays. A usual transfer takes about 24 hours, but it could be even longer than that on other occasions.
When you make a transfer using cryptocurrency, given it is decentralized, it isn’t prone to these same checks and balances. The result is that transactions are carried out a lot quicker. Speed is important for individuals and businesses, hence why they’ve both made the steady shift towards cryptocurrency in recent years.
The Increased Security
Unless someone can get access to the private key that you use to store your cryptocurrency, then they are not going to be able to see your transactions or access your funds. Not to mention, because of sites such as OKX.com that offer proof of reserves, having transparency and security when it comes to your crypto has never been easier.
When you purchase cryptocurrency, your transactions are secured, thanks to the blockchain technology that lies at the foundation of crypto. As more transactions are carried out, more is added to the blockchain, which leads to it becoming more secure. Many cybercriminals operate in this day and age and, as a result, there are a lot of people who grow increasingly cautious about access to their funds online. The secure level that is added with crypto transactions means it is a lot more of a popular option.
Diversifications
When people invest in cryptocurrency, they can diversify from more traditional financial assets that they might have previously worked with, such as stocks and bonds. Though the history of the crypto market compared with the history of stocks and bonds is relatively limited, they do not seem to correlate. This means that if an investor is looking to add more diversity to their portfolio, then they can do so.
Steady returns can be generated, thanks to the combination of different assets. For instance, if your stock portfolio goes down, then your crypto portfolio could well go up and vice versa. That being said, crypto is relatively volatile, so if you are going to include it in your portfolio, it’s best to start small and be cautious.
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