The Grand Crypto Party – You’re Invited, But Should You Go?


They say, put your money where your mouth is, and some people these days are having mouthfuls of cryptocurrency for breakfast, lunch, and dinner. Why the rising appetite for crypto? Let me first explain about this new investment conundrum that has gone from two-bit curiosity to virtually impossible to ignore.

What is cryptocurrency? Simply put, it is virtual money, the currency that operates on the decentralised blockchain platform. Its value is not determined in traditional ways such as by government control or by the price of a commodity like gold. Instead, the value of cryptocurrency is determined by open transactions in the digital sphere amongst the cryptocurrency community. It cannot be counterfeited or double-spent, and since it is not issued by any central bank, it is free of governmental interference. However, that very feature robs crypto of any sovereign guarantee, making it a high-risk asset. Trading and exchange-rate volatility compound this risk.

On the positives, crypto’s virtual nature — immunity to inflation, total transparency, and high divisibility — make it a promising candidate for use as legal tender. As recently as in June 2021, El Salvador became the first country in the world to recognise Bitcoin as legal tender1. Companies such as Microsoft and PayPal have been accepting Bitcoin as a form of payment since 2014

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