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The world is changing at an accelerated pace and so too, is the way we finance our commercial activities. As such, people are increasingly turning to alternative means of payment as they seek to purchase goods or services without needing to use cash. Cryptocurrency is one such alternative that has caught the attention of many because it has a number of attractive features that make it appear like the future of money. In this article, we will explain why you should invest in cryptocurrencies, even if you are not planning on using them for day-to-day spending. Here are six reasons why cryptocurrency is the future of money:

1. Financial Inclusion

There is growing recognition that the world’s poorest countries will not develop until the next generation has access to financial services. The key question is who will provide this service? The answer is: those in the developed world. The fact is that there are many people in the world who do not have a bank account, or even a credit card. This means that they cannot borrow money or receive remunerative interest on their money. The solution is to use a cryptocurrency to make financial inclusion possible. If a country wants to accelerate its financial inclusion efforts, it can do so by accepting cryptocurrencies as a form of currency. This will enable the unbanked population to receive remunerative interest on their money and be able to borrow money. By partnering with local cryptocurrency companies in the area, a country will be able to turn cryptocurrencies into a viable means of payment.

2. Security and Transparency

One of the best things about cryptocurrencies is their security. As cryptocurrencies are digital assets, they can be safely stored in secure digital wallets. These wallets are encrypted, which means that they are not accessible to third parties. This is an important factor as it keeps your money safe from hackers. Cryptocurrencies are transparent as well. They are created and distributed through a blockchain network. This means that every transaction made using cryptocurrencies is recorded and publicly available for anyone to see. This makes cryptocurrencies a highly transparent means of payment.

3. Reduces Illicit Trading Costs

Investing in cryptocurrencies is more cost-effective than investing in equity or bonds. Why is this the case? It is because you don’t have to pay brokerage charges on cryptocurrencies. Instead, you only pay taxes. This greatly reduces trading costs, making it a great deal more affordable than traditional investment options. The fact that you can buy and sell cryptocurrencies at a moment’s notice further reduces trading costs as you don’t have to place a large amount of capital with your investment. This is particularly important for ordinary people who don’t have a large amount of money to invest.

4. Independence and Self-Sovereignty

Another great reason to invest in cryptocurrencies is that they empower the individual. Cryptocurrencies are decentralized in nature, meaning that they are not under the control of any government or bank. This makes them an attractive option for people who are tired of governments and corporations taking away their wealth and decision-making power. Cryptocurrencies also provide a degree of independence. When you purchase a cryptocurrency, you don’t rely on anyone to provide you with the currency. You only depend on how many coins are left in the market. This means that you can invest in whichever cryptocurrency you find most appealing. If you are concerned that one cryptocurrency will fall in value more quickly than another, you can simply invest a greater amount in the one you find more appealing.

5. Improves Accountability and Trust

Another great reason to invest in cryptocurrencies is that they improve accountability and trust. Cryptocurrencies are decentralized, meaning that you don’t have to trust a central entity with your money. This makes it possible for people to engage in more direct transactions with other individuals, without having to rely on third parties like banks. They also improve accountability and trust because cryptocurrencies are auditable. This means that you can audit and verify whether the cryptocurrency you bought is the same as the one that was sold. Auditable means that you can see whether the cryptocurrency was acquired legitimately. This is significant, particularly if you want to avoid investing in scams and fraud.

6. Decentralized Networking

The final reason to invest in cryptocurrencies is that they are decentralized. When you buy cryptocurrencies, you are participating in an open network. This means that you are in complete control of your funds as no one else is involved in the transaction. This is significant for investors who want to make sure that their hard-earned money is not being held by a third party. When you buy cryptocurrencies using a decentralized network, you are able to hold the funds in a wallet that you control. The good thing is that you can diversify your investments in this way, without having to rely on a specific exchange or any other centralized entity. This is great because it gives you the autonomy to invest in whatever cryptocurrency you think is most appealing.

Should You Invest In Cryptocurrency?

Considering the volatility of crypto asset prices, it can be a daunting task for a common individual to invest in cryptocurrency. Before investing in any cryptocurrency, one must extensively research the available options and choose a particular coin or token that suits their investment goals and risk appetite.

While there is no dearth of benefits of investing in cryptocurrency, there are also several risks involved in such an investment. A common individual should understand the associated risks and be prepared to deal with them if they arise.

Risk 1: The main risk associated with investing in cryptocurrency is the high price volatility associated with these assets. In 2018, the prices of major cryptocurrencies such as Bitcoin surged by more than 1,100%. Due to such sharp fluctuations, it can be difficult for investors to plan their investment strategies accordingly.

Risk 2: Another risk associated with investing in cryptocurrency is their limited availability. Unlike normal fiat currencies, which are printed and controlled by central authorities, cryptocurrencies are completely decentralized—there is no single entity that controls them. As a result, the values of these coins can drastically change overnight due to regulatory concerns or hacking incidents.

Risk 3: Another risk associated with investing in cryptocurrency is their limited acceptance across various mainstream platforms and services. Due to regulatory restrictions or security concerns, these currencies are not accepted by all financial institutions and payment gateways worldwide. If you want to withdraw your capital from your investment, you will be forced to use separate platforms or services for this purpose.

Final Words

Investing in cryptocurrency is more than just buying a few coins. It is about exploring the new world of investing in the future of money. Cryptocurrency investing is an exciting new way of making money. It is very similar to traditional stock market investing, but with a number of key differences. One of the main differences is that cryptocurrency investing is digital, whereas stocks are physical. You can also invest in a wide range of different cryptocurrencies. You can also trade on cryptocurrency exchanges, but they are very different from traditional stock exchanges. Investing in cryptocurrency is not for everyone, but it can be a very rewarding experience if you approach it the right way.