Every now and then, something happens in the tech world that totally rocks the financial sector. The most recent thing to break the internet and financial markets at the same time is cryptocurrency. Hardly anyone had heard of cryptocurrency a few years ago, and now people talk about it the way they talk about the stock market.
Being that crypto assets are becoming a more popular investment option, people are becoming more intrigued by them. You would be wise to do your due diligence before investing in digital assets. Continue reading to learn the ins and outs, as well as the pros and cons, of cryptocurrency.
Crypto what?
The most important thing to know about cryptocurrency is what it is. In short, cryptocurrency is a type of financial asset. However, it’s not a physical asset like cash—it’s a digital currency. Bitcoin languished in obscurity for nearly 10 years before exploding in 2017. What started out as a mere pebble in the face of traditional financial asset classes has become the fastest-growing asset class in the United States.
The thing that drew so many people to cryptocurrency is the crypto part of it, namely the blockchain technology used to keep track of transactions. The currency is decentralized and no one government controls it. You can use crypto cash to purchase anything from home accessories to homes. Stock market investors and entrepreneurs alike are giving digital assets more attention and credence.
There are various ways to procure crypto assets, and you store them in your crypto wallet. There are crypto exchanges where people buy and sell cryptocurrency. There are even Bitcoin lending sites that allow you to become a Bitcoin lender or borrower.
Why should you use crypto-cash?
It’s one thing to know that everyone in the financial sector is going crypto-crazy, but the question is what makes cryptocurrency so valuable? What makes it more special than your local fiat currency?
One of the things that make crypto assets so valuable coveted is that it makes online transactions safer through the use of cryptography and blockchain technology. All cryptocurrency transactions are encrypted and added to a ledger that anyone can see. Because of the decentralized nature of cryptocurrency, no one person, group, or government controls it. Instead, everyone in a blockchain controls the blockchain.
Is cryptocurrency a sound investment opportunity?
Even though cryptocurrency can be used in many of the same ways as fiat currency, you most often hear it mentioned in the context of being an investment opportunity. Even though cryptocurrency has exploded and is showing future promise, it’s still extremely volatile. Most experienced investors and financial advisors favor alternative investments as the best way to diversify your investment portfolio. Digital assets are soaring and projected to do well in the years to come, but you’d be wise to consider alternative investments like real estate.
Yieldstreet is a premium investment platform for alternative investments in much the same way the NYSE is an investment platform for the stock market. To learn more about how Yieldstreet works, you should do your homework on some Yieldstreet reviews and investment options. Not only are alternative investments not as volatile as crypto holdings, but they also have a low correlation with the stock market. That means that what happens on the stock market has little to no effect on alternative assets.
What is a crypto loan?
One of the pros of cryptocurrency is that you can give and receive crypto loans. A crypto loan is merely when one party lends cryptocurrency to another party. If you own cryptocurrency, you can register on crypto lending platforms as a lender, and you’ll be able to loan cryptocurrency to borrowers.
In addition to borrowing cryptocurrency, you can also use crypto lending platforms to borrow fiat money against your cryptocurrency. With these types of loans, the crypto lending platform will use the borrower’s cryptocurrency as collateral for the cash loan. If the borrower doesn’t repay the loan, their cryptocurrency can be confiscated. To learn more about Bitcoin lending sites, visit cryptovantage.com.
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