Bitcoin’s value continues to soar. It’s now trading at around $50,000 per coin. That said, it’s not the first time for bitcoin prices to rally beyond expectations only to fall back with the same intensity, taking many investors along for the ride. In December 2017, bitcoin rose to almost $20,000 per coin. In less than a week, the price fell to around $11,000. Investors lost about 45% of their money that year.
Be that as it may, many investors are taking a second look at bitcoin. Regardless of the notorious price fluctuations, bitcoin’s unique characteristics make it an excellent asset to invest in. Plus, investors who are already into stocks may want to add diversity to their portfolios by investing in bitcoins. And unlike other types of assets or commodities, bitcoin and other cryptocurrencies have more benefits besides huge profit margin potential.
Below are some key benefits of investing in bitcoin.
One of the most significant benefits of bitcoin and other cryptocurrencies, for that matter, is the self-determination they provide users. As an investor, you take responsibility for your digital coins. You can buy or spend your cryptos as you please.
Investors don’t have to be slowed down by inherent inefficiencies present in traditional banks or central banks and the governments they represent. Proof of that is how easy it is for anyone to enter the crypto market. For instance, Canadians who are just starting to learn how to buy bitcoin in Canada will tell you that the whole process can be done in three steps:
The procedure illustrated above is practically the standard among all bitcoin or crypto exchanges around the world. The point is, investing in bitcoins has low barriers to entry, even for beginner investors.
Supposed you’re a member of an ethnic minority in a country that has enacted laws preventing you from opening a bank account. Or imagine your country faces economic sanctions and your fiat money has lost a lot of its value. Where will you keep your money? How will you invest, let alone buy or sell goods and services? More importantly, how will you ensure that your investment will hold, or even multiply, its value amidst economic turmoil? These questions are not hypothetical. The events described above are happening now. For instance, take the case of Hong Kong and India.
With bitcoin, you can spare your investment from the adverse effects of political and economic downturns. Bitcoin’s decentralized nature allows investors and users to bypass the ill-effects of political and economic pressures.
Buying and selling bitcoin give rise to transaction fees. The exchanges themselves may charge fees for each deposit or withdrawal. Still, these fees are cheaper compared to the costs that traditional banks and investment houses charge their clients. For one, you don’t have to pay commissions to investment advisors or brokerage firms.
You can freely send or receive bitcoin investment to or from other users within the bitcoin network. You don’t have to get approval from banks or government agencies. That means you cut through the usual red tape.
Since there are no traditional intermediaries involved in bitcoin investing, transaction costs are at the minimum. Plus, with less bureaucracy, you can instantly transfer your bitcoin investment to any account. Moreover, you can make investment decisions materialize without the long waiting periods commonly associated with traditional assets.
The transactions involved in your bitcoin portfolio are discrete and private. They will never be linked to your identity. Your bitcoin address is made up of a long string of alphanumeric characters that do not indicate your name and other personal details. If you choose, you can even change your bitcoin wallet address per transaction.
Buying and selling cryptos like bitcoin have many similarities to cash purchases. Your transactions have a good chance of remaining anonymous since they can be difficult to trace.
Besides bitcoin’s wide fluctuations that give investors more opportunities to make profits, this crypto asset has other benefits to offer. If you value autonomy, immunity from political and economic disturbances, lower fees, decentralization, and anonymity in your investment portfolio, then it’s time you look into bitcoin as an investment.
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Stefan has been writing articles for DCForecasts since 2016 in-house full time. As one of our main cryptocurrency writers, he focuses on covering the latest cryptocurrency news, technical charts, price analyses of coins and press releases. When he is not exploring and covering the latest topics in crypto, you can find Stefan playing basketball, tennis or cycling.
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