When the central bank in bank accounts and limited the amount of cash that may be withdrawn from bank accounts it created an enormous uproar that was felt round the world. If consumers did not have access to money how could they buy and sell the things had a need to carry on inside our modern world? The reality is they can’t so consumers around the globe started to look for safer alternatives to fiat currency. Fiat currency is currency that has no tangible value irrespective of what the government assigns to it.
Consumers are buying a way to store their buying power to guard themselves from having bank accounts frozen for indefinite periods of time. Many people Spice started trading in Bitcoins. This is a crypto-currency meaning it cannot be easily counterfeited but before anyone starts buying into this new currency it would be prudent to know the risks.
Bitcoins aren’t issued by any central bank or government so there is no accountability whatsoever. If you are working with Dollars,Euros or Pounds you’ve the assurance that the government behind it’ll honor the debt while Bitcoins don’t provide any guarantees at all. The fact that no-one truly knows who made this currency so there is no means of knowing whether it could be stolen from the comfort of under our eyes.
These Bitcoins are stored inside a digital wallet which can be encrypted on your own computer. While this should provide a sense of security if your computer is lost your Bitcoins are gone as well. It’s not like a bank card where you could get an alternative and carry on like nothing has happened.
While the security of this currency is really a concern undoubtedly the biggest worry is the worthiness of it. The perceived value of a Bitcoin can transform in a moment and unlike fiat currencies which are backed by hard assets owned by a nation in case a Bitcoin value drops you’ve nothing of value at all.
There are a few exchanges around the globe that sell and buy Bitcoins, but you shouldn’t find them thinking they will rise in value. They’re an electronic digital commodity which some would classify as a “fad “.Tomorrow it could 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 by a government. The value if highly volatile and might be reduced to zero in a heart rate and the simple fact that the currency has only existed for a few years shows it is not shown to be reliable.
If you are buying a way to preserve value then precious metals like gold,silver and platinum may be more beneficial since they’ve been employed for centuries as a moderate of exchange.
When it comes to investing you need to never make rash decisions but weigh the risks and potential payoff and remember that there surely is no sure things as it pertains to digital currencies like Bitcoins so approach at your personal risk.