B is for Bitcoin Buzz: Will it Boom or Bust?

B is for Bitcoin Buzz: Will it Boom or Bust?

Undoubtedly, by now, you have heard of bitcoin. Whether it be from the news a few weeks ago or if you have been following this new technology for years, most of us are familiar with this cryptocurrency. But still, the question begs, will it continue to boom or bust?

Yes, it’s true Bitcoin has been gaining popularity but, this doesn’t make it a smart investment.

While all investments are subject to short-term volatility, Bitcoin has suffered tremendous levels of turbulence. Given the volatility of this type of currency and its murky future, it’s uncertain whether Bitcoin is here to stay. Only time will tell.

Before you invest any of your hard-earned money, think carefully about your risk tolerance. If you have money to risk, it may be worth the gamble, but for most investors, it best to abstain until future notice.

What is Bitcoin?

Bitcoin is a digital currency that is operated by a decentralized authority and has no physical bitcoins, rather a public ledger that everyone has transparent access to. Because it is not backed by an institutionalized bank or government agency, they are not legal tender and are not protected should your “money” be stolen. Also, according to Fundera, there is only around 2,300 U.S. business that accepts Bitcoin as payment. Keep in mind, without widespread acceptance, it will be hard for Bitcoin to survive.

What are some advantages?

Bitcoin is anonymous and discreet. No one can see your transactions, unlike a payment system such as Venmo. Payments from and to others within the Bitcoin network are instant and have no fees. Also, the transaction fees for international payments are very low compared to banks. And because it is a cryptocurrency, all the transactions are made digitally. This means you can access your funds from the comfort of your mobile device or computer, rather than visiting a brick-and-mortar bank.

What are some disadvantages?

Bitcoins tend to operate more like cash. And since it is not a legal tender, backed by an institution, if they were to be hacked or stolen, they are most likely gone forever. It is not a widely accepted form of payment. Therefore, if all your money is tied up in Bitcoin, you would have to exchange it first before using it. 

While it seems as if Bitcoin is only becoming more popular and valuable, it is still a very risky investment, and is most likely not worth your hard earned money. But still, only time will tell if it will continue to boom or bust.

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