Wondering if you should invest in overclocking guide site? If you’ve been around any kid of financial news lately, you’ve no doubt heard about the meteoric rise in the world’s most well-known cryptocurrency.
Well here’s a few things you should know about Bitcoin before you invest. Also note that this article is for information purposes only and should not be taken as any kind of financial advice.
Bitcoin is known as a cryptocurrency or a digital currency. It’s basically online money. Like any currency you can exchange it for other currencies (like say, buy bitcoins with US dollars or vice versa) and it fluctuates in relation to other currencies as well.
Unlike other currencies however it is decentralized, meaning there isn’t any one central bank, country or government in charge of it. And that means it’s not as susceptible to government or central bank mismanagement.
Because it’s decentralized, this also means that you can send a friend Bitcoin (money) on the other side of the world in seconds without having to go through a bank intermediary (and pay the banking fees).
There are only 21 million Bitcoins that will ever be mined. This limits the amount of Bitcoin that can ever be produced. This is like saying a government cannot print money because there is a limited supply of bills – and they won’t print anymore.
This limited supply has also helped to contribute to the rise in the price of Bitcoin. People don’t want a currency that can be printed – or inflated – into infinity at the whim of a greedy government.
Most people think that Bitcoin is completely anonymous. But actually it’s not anonymous – it’s more private. All Bitcoin transactions ever made can be seen on the Blockchain – the public Bitcoin ledger.
But your name and identifying details behind the transaction are not seen. Each transaction is linked to an address – a string of text and characters. So while people might see your address – there is no way to link that address to you.
A lot of people who don’t like their banks spying on them (or telling them how much of their own money that they can or can’t move), really like this privacy feature.
Many businesses have to take Visa or MasterCard these days to stay competitive. However these cards take some rather substantial fees out of each sales transaction.
Because it’s being traded 24 hours a day 7 days a week, the price is always fluctuating. And all it takes it some bad news – like the news of the Mt Gox hack a few years ago – to send the price tumbling down.
So basically it’s not stable – and there are a lot of unknowns out there that can affect the price. The rule here is this: don’t put any money into Bitcoin that you can’t afford to lose.
Also, there are a lot of tales from people who have lost their Bitcoin wallet address (through hacking, phones being stolen, virus-infected computers, etc.) and they’ve completely lost their coins. There’s no way to get them back.
For this reason, you really need to know what you’re doing and take the time to research how to buy and store your coins properly if you want to invest in Bitcoins – or any other cryptocurrency.
So those are some of the things to consider before investing in Bitcoin. Basically while Bitcoin has a lot of great things going for it – and while it has the potential to change financial transactions as we know it – there is still a lot of risk. There are a lot of unknowns out there still.
If you do decide to buy, take your time and research your options. Don’t buy from just any seller. Some of them are trustworthy and run a great business. But there are others that will overcharge you and may not even deliver your coins.
