Many people have heard of the latest financial meltdown, the worst since the Great Depression. Some are also starting to look into ways of protecting their assets – with gold perhaps topping the list. Others are thinking about moving their money over to the realm of virtual currency – in the same way as people have done with gold for years. But if you’re unfamiliar with the world of bitcoins, it may seem a bit strange to find tips for securing your investment in this newer kind of virtual money. After all, what’s so different about it? After all, we know that gold is pretty well known as a safe haven asset.
In a world where virtual currencies are becoming increasingly popular, one out-of-the-box innovation stands out as having the potential to combine the best of both worlds. Bitcoins is a newer kind of Cryptocurrency, a kind of virtual private money which works without the need of a central bank or government to control it. Like gold, it offers a safety premium as an investment commodity, but the volatility of its price swings make it an uncertain long-term investment. Here’s a look at some ways you can secure your position in this growing market.
A number of new players are entering the marketplace each year. However, the newcomers are typically from one of two sectors: entrepreneurs and investors. Neither group has much experience with the protocols and mechanics of the more traditional markets – hence the appeal of the newer coins. For the newcomers, it’s important to understand the two facets of this exciting new frontier – how the core developers plan to tackle the problems of privacy and security, and how the core protocol will manage the transfer of funds. In order to take advantage of this dynamic, some investors have started using the “blockchain” to automate the trading process.
The most popular use of the platform is the Forex trading market. The reason for this is the ease of access it provides for both institutional investors and individual traders. Through the use of the cME (Collins Middle Market) there are opportunities to trade currency pairs across different countries, time zones, and from locations that may not otherwise be accessible to Forex traders. The major benefit of this is the fact that it eliminates the need for brokers, making the CME an affordable option for both small-scale investors and larger corporations.
The next step for CME is to enable the general public to trade in the currencies it handles. Although this has been accomplished for some of the smaller exchanges, it’s only just now starting to take shape for the larger mainstream institutions. Due to the high level of development expected in this decade, it’s safe to predict that the major decentralized cryptocurrencies will make their way into the public domain by 2020.
In order to understand how the future will unfold for the largest and most liquid Cryptocurrency exchange, it’s important to examine three key factors that will determine whether or not the market remains robust enough to support a long-term gain for investors. The first of these is growth. It’s no secret that investors are worried about the state of the economy. As things stand currently, it would be very difficult for the economy to sustain its current level of growth for any length of time, as it battles with inflation, government debt, and political instability.
The second of these three key factors is profitability. Since the launch of the Bitcoin ETF in 2020, the value of the cryptocurency has increased exponentially, allowing investors to reap large profits from their investment with a much lower risk level. While many experts predict that the value of the cryptocurency will continue to rise exponentially in the coming years, there is also some pessimism surrounding this prediction. This pessimism comes from the fear that investors will become too dependent on the rising value of the currency to enjoy profitable returns. If this happens, it could negatively impact the economy and cause great damage to the economic stability.
The third factor that should be examined is longevity. In order for an investment to be successful, it should be able to remain viable for the long-term. Since the launch of the Bitcoin ETF in 2020, investors have been investing in this highly volatile currency. The lack of fundamental risk and the fact that the market can operate continuously 24 hours a day without interruption make the US Dollar the undisputed leader when it comes to strong investment climates. Whether investors choose to invest in the US Dollar or another currency remains to be seen, but one thing is for certain: based on the track record of the popular currency, it is likely that investors will remain attracted to investing in the US Dollar for the foreseeable future.