Guest Post from Ravinder Sahu
Some people seem like they were born to be early adopters. They know what the cool products to have are before they’ve hit the market. They’re the first in line to get the latest Apple product and the first to know the latest trend in investing. Not all of us are naturally savvy in this regard, but that doesn’t mean we can’t make up in effort what we lack in natural instincts. The same goes for cryptocurrency. Some just seemed to know this was a bandwagon worth joining. Others took a “wait and see” approach. If you fall into the latter camp, you might be wondering if it’s worth it to hop on now. Missed out on buying into cryptos early? That’s okay. You can still make cryptocurrency investments that’ll turn a profit. Let’s explore that below.
First of All, What is Cryptocurrency?
Cryptocurrency is a digital currency that uses encryption techniques to regulate and verify funds transfers. The key for most people that were attracted to this right away is that it operates independent of a centralized bank. The “honest money” crowd values privacy above all else and those who have been turned off by the many security breaches in recent years have also seen this as a sound financial alternative to traditional currency. The first of its kind, Bitcoin has allowed for a personal wealth avenue that is beyond confiscation and restriction.
Why Do Some People Think It’s Too Late to Invest in Crypto?
The reason some people think it’s too late to invest in this type of digital currency is that there is a controlled supply. As this Huffington Post Australia article notes, “It’s important to note there is a limit for how many bitcoins can be created, with a maximum amount of 21 million. However even with this cap, there won’t ever be the full amount in circulation, as some unlucky people have lost their keys (and thus their access) along the way.”
That being pointed out, it’s important to also note that Bitcoin isn’t the only type of digital currency out there. Ethereum is its biggest competitor, but there are a number of Altcoins that have picked up speed in recent years, and these don’t seem to be going anywhere any time soon. In fact, despite what many called a “crash” in December, many of these altcoins have experienced tremendous growth.
Give it To Me Straight—is it Too Late to Invest in Cryptocurrency?
Just as we noted there is a controlled supply, it’s important to point out that there is still currency yet to be mined. In the words of Jim Carrey in Dumb and Dumber, “you’re telling me there’s a chance.” Yes, yes there is. And in these days of higher inflation, this might just the sliver of hope you’ve been seeking.
“Buying Bitcoin now is not too late,” CEO of digital currency management company Bron.Tech, Emma Poposka mentioned in that same HuffPo article. “If we see full adoption in the future, or mainstream adoption, the price still has to go up in value because we have a limited supply.”
Others aren’t as sure. As author of Irrational Exuberance and 2013 Nobel Memorial Prize in Economic Science winner Robert Shiller says via PopSci.com, “It’s hard to know when the bubble will end. It’s impossible to know if the price will keep going up, and it’s hard to even guess. We also have no idea if going ‘short’ right now, or betting that the price will decline, will be better than going long,’ or betting that the price will continue to go up over time.”
As with nearly every type of investment, though, with no risk comes no reward. The first way to look at it is that this isn’t the type of consistent investing you’d do for your retirement anyway, so don’t consider it for something like that. And, as already mentioned, Bitcoin isn’t the only horse in this race. If you’re looking to invest in crypto, the plethora of up-and-coming altcoins may be the way to go.
If you’re looking to sum this up in a nice, neat way, we stick by our statement that it is still possible to invest in cryptocurrency and turn a profit. Do your due diligence and you could be on your way to making some serious (alt) coin.
Thanks to Ravinder Sahu
The Deviant Investor