16 percent of Americans say they’ve bought, traded, or invested in a cryptocurrency. That’s over 50 million people, and it’s a number that’s only going to get bigger as cryptocurrencies continue to remake the face of the global economy.
But if you’re one of the 84 percent that have yet to open your digital wallet, the question “why invest in cryptocurrency?” might not have an obvious answer. What separates these indelible digital tokens from more familiar, physical assets and commodities?
Well, wonder no more. We’re here to give you a quick and comprehensive breakdown of crypto. What is cryptocurrency? What’s the best cryptocurrency? And how does cryptocurrency work? Read on to find out!
What Is Cryptocurrency, Anyway?
Let’s start with the basics. Cryptocurrencies work thanks to a technological innovation called the blockchain. The blockchain is, in essence, a ledger that is distributed across a load of different machines all at the same time. It can’t be tampered with or altered because it’s decentralized, and because it’s protected by a load of cryptographic wizardry.
A cryptocurrency is basically an entry on one of these ledgers (there are loads of different blockchains) that says such-and-such a person owns such-and-such a cryptocurrency. Everyone trusts it and feels confident trading those entries because the underlying blockchain tech is so secure.
So, Why Invest In Cryptocurrency?
Well, that security we mentioned is one great reason. If you own some Bitcoin, Dogecoin, or Luna, you can be certain it’s going to remain yours until you elect to trade it. No one is going to “hack” the blockchain and alter it so that your crypto doesn’t belong to you anymore.
That’s a big advantage that crypto has over more centralized digital assets, which are more vulnerable to hacking attempts.
One of the biggest benefits of cryptocurrency, and also one of the biggest risks of investing in cryptocurrency, is volatility. Plenty of people have bought Bitcoin hoping it would go ‘to the moon’ and let them cash out with a tidy profit. Some of them were successful, and some of them weren’t.
The fact remains, though, that the volatility of crypto means its potential returns are more than most other asset classes out there. But do make sure to check the Luna coin price and make sure you’re buying the dip before you stake your life savings on it, yeah?
Investing in Crypto for Fun and Profit
And that concludes our brief yet thorough guide to the question: why invest in cryptocurrency? Whether you’re a seasoned asset trader looking to diversify your portfolio, or just someone curious about innovative new tech, cryptocurrency investments have something to offer you.
So what are you waiting for? Get out there and put some money down. This one’s going all the way to the moon!
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