Introduced in the year 2008, Bitcoin took over the Market by storm. Individuals adapted to this alternative payment method with ease, which paved the way for digital currency to come to the forefront of digital investments. In the past seven years, there has been tremendous growth in the bitcoin market as more individuals started to participate, and the integration also became broader. While many signs encouraged individuals to invest in Bitcoin simultaneously, there were enough reasons for it not to penetrate deep into every Market. Like every cryptocurrency and investment, Bitcoins have advantages and disadvantages. Before you step into the market, it is crucial to critically evaluate all aspects of BTC as it helps you plan better and face difficulties easily. bItlq makes the complex concept easier for you and is a great way to start your journey as an investor.
Advantages of Bitcoin investment
1-Decentralised Finance Market
The most significant factor that drew individuals to invest in the bitcoin market was that a central authority did not control it. This means that your investments are not controlled or dependent on the acts of a single institution. As opposed to the traditional market or your real-life currency, BTC is not under the government’s control. It is controlled by every person who is on the blockchain market without having any power to manipulate the network. In addition, no one holds the power to freeze your bitcoins. You have complete control/autonomy over your money and can invest in a decentralised market—a perfect alternative to a centralised market that has lost trust like no other.
2-Accessibility and Liquidity
The Bitcoin market knows no boundaries and allows everyone to invest, trade, and transact. There is no third party involved which makes the whole process easy. Further, since it is a digital currency, you can invest in the broader market without limitations. Currency conversions are not a tough job. Once you own bitcoins, you can use them in ways you wish. Bitcoin investors and experts consider the liquidity feature of Bitcoins the most beneficial as it retains almost total value when converted to real-world currencies.
3-In-time and High returns
Bitcoin investments provide better opportunities for both short-term and long-term plans. The Market is vast, and individuals are free to invest in the field of their choice. Bitcoin investment is considered advantageous for day-to-day profits or monthly and annual investments. Since there are no intermediaries, profits are also easily accessible. Individuals have gained unimaginable profits in the shortest period. It only requires you to have an understanding of market trends.
Disadvantages of Bitcoin Investment
While the returns are high in bitcoin investments, the risk attached to them is equally high. The Bitcoin market is not considered a place for the faint-hearted as it is highly volatile. Designed for individuals who can take significant risks, investing in Bitcoin demands financial stability to fall back to. There is enough data to suggest significant losses that investors have faced in the Market because of its volatile nature, and the number of lost investors is a whole other story that suggests the same. The volatile nature has become the biggest drawback for the BTC market.
Bitcoins are created using a “mining” process requiring high power and specific skills. Since not everyone in the Market knows how to mine bitcoins, it limits Bitcoins and gives a certain amount of power to those who know. In the long run, this defeats the decentralised system and makes it just like any other investment market. In addition, it is interesting to know that there are 21 million bitcoins in the Market, and this fixed number paves the way for monopoly and central control.
The introduction of Bitcoins became a topic of discussion, and its integration was comprehensive in the first 10-14 years. However, since 2021 there have been trends of a significant decline in its value. Individuals have withdrawn due to constant losses. This makes it a market value only for those who still see a future in cryptocurrencies and are financially stable even when their money is stuck in the Market.
With its advantages and disadvantages, you can decide whether it is the right step time to step in or out of the Bitcoin investment world.