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Why You Should Be Using Cryptocurrency

In recent years, cryptocurrency has taken the world by storm, and its global market size is expected to reach $4.94 billion by 2030. This currency is digitized money in the form of virtual tokens or coins that can be used to purchase and sell products from individuals or businesses willing to undertake such transactions. 

A variety of cryptocurrencies are available, each with its own pattern and market value, such as Bitcoin, Ethereum, Litecoin, and Cardano. Currently, Bitcoin is the most popular. The peer-to-peer networking nature of cryptocurrencies enables direct user communication by eliminating the need for third-party intrusion. In this article, we’ll break down a few reasons why you should consider investing in this venture.

1. Transactions are Easy

Cryptocurrency transactions can be made seamlessly at a low cost and offer greater privacy. You simply perform them using a smartphone app and your digital cryptocurrency wallet.

It’s also possible to purchase some cryptocurrencies using cash at a Bitcoin ATM, applicable on coins such as Bitcoin, Ethereum, and Litecoin. For example, when you buy them at the ATM, you can transfer the coins to your phone on the spot. Using cryptocurrency doesn’t necessarily require a bank account, and there’s no need to go through time-consuming, complicated procedures or fill out checks, no matter the amount you need or your geographical location. This gives crypto an edge over bank transactions. 

2. Portfolio Diversification

Compared to conventional financial assets like equities and bonds, cryptocurrency can provide investors with substantial opportunities to diversify their portfolios. While historical data does not offer solid conclusions regarding the performance of cryptocurrency markets compared to equities or bonds, until now, the values don’t seem to correlate with those of other assets. This makes them excellent alternative holdings for portfolio diversification purposes.

You achieve well-rounded results by mixing assets with low price correlation. When your stock portfolio decreases, your crypto assets may have a greater chance of increasing, and vice versa. However, if your asset allocation is greatly inclined towards cryptocurrencies, it will make your entire portfolio appear more volatile.

You May Read: When is the Right Time to Purchase Bitcoin?

3. Greater Privacy

Since you aren’t required to sign up for any accounts at a financial establishment, you retain a lot of privacy when using cryptocurrencies. The transactions are pseudonymous: your wallet address doesn’t contain any of your personal data despite serving as a unique identifier on the blockchain.

The ability to retain anonymity can be helpful in different types of situations. However, once someone links your identity with your wallet address, the entire transaction history becomes visible to them. If you wish to avoid constant surveillance, you can always use more than one wallet. There are many privacy-focused coins available to help you retain your privacy.

You May Read: How Does Blockchain Technology Work?

4. Quick Settlement and Affordable Fees

Most people invest in crypto coins because they expect these coins’ values to increase over time and earn them profits. However, many individuals also use cryptocurrency because it is a very effective medium of exchange. The transaction fees for Bitcoin and Ether can range from cents to a few dollars and have been very affordable. 

The price of sending other cryptocurrencies like Litecoin, XRP, and others is almost negligible. Most crypto payments can be carried out in seconds or minutes, whereas bank wire transfers frequently take three to five business days to go through and are much more expensive.

You May Read: Crypto Lending and Borrowing

5. Better Security

No one can sign for transactions or gain access to your funds unless they know the private code to your crypto wallet — the blockchain system design and the distributed computer network verify transactions and ensure they remain protected. The more processing power that you add, the safer the network gets. You should note that there is also no way to get your money back if you misplace your private key. 

Hacking the network to manipulate the blockchain and put numerous blocks in place requires much effort, knowledge, and skills regarding that specific network. Such a violation is costly to carry out for threat actors targeting well-known blockchains like Bitcoin or Ethereum, so your money will be secure. Cryptocurrency account hacks usually occur at the centralized exchange level because of poorly managed security. It’s safer to retain your cryptocurrency assets in your own wallet.

6. Greater Financial Inclusion

Crypto offers many advantages for individuals who do not have access to the resources of a conventional financial system. Anyone can use cryptocurrency due to its decentralized status and the lack of need for an authority whose permission you might require. Nobody can decide who has access to the crypto marketplace, be it a government or financial institution. 

7. Protection Against Inflation

Many believe that cryptocurrencies like Bitcoin can protect them against the repercussions of inflation. The total amount of Bitcoin coins that will ever be produced has a solid cap. Bitcoin’s price rises when the money supply expands faster than the supply of Bitcoins. 

Other cryptocurrencies also use measures that limit supply and can serve as an inflation hedge. The price of these fixed-supply coins as measured in dollars has a significant likelihood of increasing as more dollars compete with fewer coins. In the long run, the value of supply-capped goods always increases.

You May Read: Things to Know Before You Buy Bitcoin

8. Financial Freedom

Banks or other payment processors have the power to discontinue anyone’s services at any time, and for whatever reason they deem fit. For certain political figures, journalists, or people operating in countries with oppressive government regimes, this can make things challenging and cause problems for them. 

On the other hand, cryptocurrency’s ability to be utilized as a means of exchange between two parties without any intervention makes it stand out. Since financial dealings can be done without the involvement of a third party, the transaction is more open and does not require or entertain censorship. It’s also not possible to completely prevent anyone from using Bitcoin or the majority of other cryptocurrencies because there is no central authority controlling them.

Endnote

There’s no doubt that cryptocurrency is not without its flaws, but the benefits can open up endless opportunities if you do thorough research and stay updated on the changing statistics. As with most financial matters, anyone looking to buy, sell, or trade this currency should learn about crypto from comprehensive sources available online or consult professionals well-versed in its patterns.

As the modern world continues to incorporate the digital world into every aspect of life, cryptocurrency is a valuable asset to possess.

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