When the central bank in bank accounts and limited the amount of cash that might be withdrawn from bank accounts it created a huge uproar which was felt across the world. If consumers did not need usage of money how could they buy and sell the things had a need to keep on inside our modern world? The truth 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 aside from what the government assigns to it.
Consumers are buying way to store their buying power to safeguard themselves from having bank accounts frozen for indefinite periods of time. Many people Spice started trading in Bitcoins. This is a crypto-currency which means it can’t be easily counterfeited but before anyone starts buying into this new currency it would be prudent to comprehend the risks.
Bitcoins aren’t issued by any central bank or government so there is no accountability whatsoever. If you’re working with Dollars,Euros or Pounds you have the assurance that the government behind it will honor the debt while Bitcoins don’t provide any guarantees at all. The fact no one truly knows who made this currency so there is no method of knowing whether maybe it’s stolen right from under our eyes.
These Bitcoins are stored in the digital wallet which can be encrypted on your computer. While this would provide a feeling of security if your computer is lost your Bitcoins are gone as well. It’s nothing like a bank card where you can get an alternative and keep on like nothing has happened.
While the security of this currency is just a concern undoubtedly the largest worry is the value of it. The perceived value of a Bitcoin may change in a moment and unlike fiat currencies that are backed by hard assets owned by a country if your Bitcoin value drops you have nothing of value at all.
There are a few exchanges around the globe that sell and buy Bitcoins, but you shouldn’t get them thinking they will rise in value. They are an electronic 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 do not have any real security with Bitcoins because they are not provided with a government. The worthiness if highly volatile and could possibly be reduced to zero in a heartbeat and the simple undeniable fact that the currency has only existed for a few years shows it’s not which may be reliable.
If you’re buying way to preserve value then precious metals like gold,silver and platinum may be much more beneficial since they have been useful for centuries as a moderate of exchange.
As it pertains to investing you must never make rash decisions but weigh the risks and potential payoff and remember that there is no sure things in regards to digital currencies like Bitcoins so approach at your own risk.