Once the central bank in Cyprus froze bank accounts and limited the sum of money that could be withdrawn from bank accounts it created a massive uproar which was felt across the world. If consumers did not need access to money how could they buy and sell what exactly had a need to keep on within our modern world? The stark reality is they can’t so consumers around the globe started to look for safer alternatives to fiat currency. Fiat currency is currency that’s no tangible value irrespective of what the us government assigns to it.
Consumers are buying a method to store their buying power to guard themselves from having bank accounts frozen for indefinite periods of time. Lots of people started trading in Bitcoins. This is a crypto-currency which means it cannot be easily counterfeited but before anyone starts buying into this new currency it will be prudent to know the risks.
Bitcoins are not issued by any central bank or government so there’s no accountability whatsoever. If you should be working with Dollars,Euros or Pounds you’ve the assurance that the us government behind it will honor the debt while Bitcoins don’t provide any guarantees at all. The fact that nobody truly knows who made this currency so there’s no means of knowing whether it could be stolen from the comfort of under our eyes.
These Bitcoins are stored inside a digital wallet which can be encrypted on your own computer. While this will provide a sense of security if your personal computer is lost your Bitcoins are gone as well. It is nothing like a bank card where you could get an upgraded and keep on like nothing has happened.
While the security of the currency is just a concern definitely the largest worry is the worth of it. The perceived value of a Bitcoin can transform in an instant and unlike fiat currencies which are backed by hard assets owned by a country if your Bitcoin value drops you’ve nothing of value at all.
There are always a few exchanges around the globe that sell and buy Bitcoins, but you ought not get them thinking they are going to rise in value bitcoin instantly. They are a digital commodity which some would classify as a “fad “.Tomorrow it might lose all its real value and never recover.
So to recap the risks, you may not have any real security with Bitcoins as they are not provided by way of a government. The value if highly volatile and could possibly be reduced to zero in a heart beat and the easy proven fact that the currency has only been around for a few years shows it’s not proven to be reliable.
If you should be buying a method to preserve value then precious metals like gold,silver and platinum may be more beneficial since they’ve been employed for centuries as a moderate of exchange.
When it comes to investing you must never make rash decisions but weigh the risks and potential payoff and remember that there surely is no sure things when it comes to digital currencies like Bitcoins so approach at your own personal risk.