Why Investing And Incorporating Cryptocurrency In A Business Is Good

Investing and trading in digital currencies entails considerable risk of loss and isn’t fit for all investors. Because of the valuation and volatility of cryptocurrencies, investors may profit or lose greater than their initial investment, which is way many investors opt to use crypto calls, commonly recognized as signals. Crypto calls are a series of directives sent in real time outlining which crypto asset to buy and/or sell at a certain price and time and to make certain that loss is at minimal when a trade goes wrong.

Although there are crypto calls or crypt trade signals to help in crypto trades, is investing in cryptocurrency still a good way to go?

Why Investing In Cryptocurrency Is Good For A Business

As individuals choose to venture into crypto they simply have to consider their own financial aims and risk. But for businesses, a lot more is in the balance when investing in cryptocurrencies as there are more parties involved and in the event that the investment is unsuccessful, the whole business can be threatened. Nonetheless, compared to private individuals or investors, businesses have more preferences when getting into the crypto and the blockchain.

A lot of businesses and companies have started to invest and incorporate cryptocurrencies in their operations, whereas others have even created their own crypto coin. Take Facebook for instance. The company has seen the potentials of cryptocurrency, hence have announced their plan to release Facebook Libra in 2020. This, however, wasn’t taken as a good news by many, especially the government.

Nonetheless, there are definite advantages for businesses to incorporate and invest in these digital currencies.

  • Lesser Fees

One of the greatest plus points about cryptocurrency, like bitcoin, is the lesser overall fees in contrast to other traditional sources of funding. This is so since there is the absence of intermediaries or third parties, like banks, between you and your customer.

  • Complete Ownership

With cryptocurrencies, account holders own every coins they have in their wallet since the “blockchain” is the coin itself. Although its value may fluctuate greatly, which might have an effect on your business, the best thing is that holders of cryptocurrencies have complete ownership.

  • Access to New Niches in the Market

Frequently, businesses don’t get the opportunity to get in on an entirely new market niche since they have not adopted cryptocurrency yet. Although many businesses find in risky to invest in cryptocurrency, those that do will have a greater advantage on their competition as they have higher chances of discovering new market niches in the market that involve the use of cryptocurrency.

  • Decreased Encounter With Fraud

While it is a fact the cyrptocurrency investment and exchanges entices scammers, businesses who accept cryptocurrencies are generally fairly fraud-free since they couldn’t be counterfeited. It is however still important to be vigilant and cautions.

Bitcoin Investment – Good or Bad?

There is no direct answer to this question. To know if Bitcoin investment is a good or a bad idea, one will have to understand what are bitcoins, how it works, and what is its value. Let’s take a look at a quick overview of Bitcoins.

What is Bitcoin?

There is no single answer when defining bitcoins. Nonetheless, if there’s one definition for Bitcoin (with a capital B), it is a system which serves a digital ledger. From this ledger, people can mine, keep and use the best crypto trading bots to trade bitcoins (with a small b), a digital type of money gained by using a computer algorithm. This digital currency is not tied to any central authority.

Why Is Bitcoin Valuable?

The ideal brand new currency in this digital era will need to have at least three primary characteristics as described below:

  • It must not be under the control of any authority and cannot be controlled or printed at will so that no one can dictate how one can and cannot use the currency.
  • It must be with no borders so that exchange can be done with ease and convenience with anyone anywhere.
  • It will need to be non-political so as to not favor a particular system or people. In short, among many other characteristics of Bitcoin, these are the most attractive that makes it a better option to the fiat-based money system.

Bitcoin is the first in the world when it comes to decentralized digital currency. Its value comes mainly from the fact that it is the very first digital currency without any one person, organization or institution having control over it. Any person can buy it and so any person can receive it. No one can dictate any person how it can or cannot be used for.

This is a kind of money without hyperinflation, oppression, and dictatorship. It is, in fact, a financial haven for people living in such situations. It has a reasonably limited supply of around 21 million bitcoins in total and this limit will never change. We know precisely how many are released and its rate as well as an approximate of when the last bitcoin will be made.

For people living in first-world countries, understanding the value of decentralized money is a bit harder to understand. This is mainly because their money is stable or seems to be stable. The way to understand the value of bitcoin is to understand why fiat money is not at all stable.

Is Investing in Bitcoin A Good Idea?

While deciding whether an investment is good or bad is really a speculating game, there are several proven ways to identify its asset value in order to say that it is either good or bad. Among the easiest ways to use Bitcoin as an investment is to consider its surge compared to the USD.

Watch the video below for a simple explanation of Bitcoin, how it works and is it worth investing to? 

A short time ago, bitcoin prices have soared by $1,000 and have exceeded $1,500. If you invested in digital currency a few years ago when its value was still around $150, or when it was initially launched in 2009 and have had zero value versus the dollar, you might believe it would have brought a great investment.

In addition, the basic principle behind Bitcoin is the fact there are just 21,000,000 tokens, which means that it can keep steady value or add value in accordance with various other currency that could be printed indefinitely. Some other reasons that make an asset appear to be a great investment include its level of popularity, network results, reliability, immutability as well as status, which is the first in a developing environment of digital currencies.

Having said that, at least one important argument to limit bitcoin to a fraction of your portfolio. Bitcoin is known for its obvious jump in price, peaks and deep valleys, which makes it challenging to have assurance in the asset to be used as a long-lasting money-making institution that can be relied upon. It is unwise to tie every penny you have to such an unstable asset. A very good rule to adhere to is never to put more than you are ready to lose.

Asset Manager Bitwise Submits Analysis to Show that 95% of Bitcoin Trading are Hoaxes

Bitwise, the company that pioneered crypto asset management and founded the world’s first cryptocurrency index fund, conducted a study that revealed 95% of bitcoin trading reported are mere hoaxes. The asset management company followed up a survey conducted by the Wall Street Journal in light of concerns voiced by regulators about cryptocurrency market, and its vulnerability to trading manipulation.

While in the process of listing the first bitcoin Exchange Traded Fund (ETF), Bitwise met with officials of the Securities and Exchange Commission (SEC) to submit its analysis. The firm reviewed the top data furnished by CoinMarketCap.com and analyzed the volume of top 81 crypto exchanges. The analysis revealed that of the aggregate $6 billion reported by CoinMarketCap as average daily bitcoin volume, only $273 million worth is legitimate.

Matthew Hougan, Bitwise Global Head of Research remarked,

“People looked at cryptocurrency and said this market is a mess; that’s because they were looking at data that was manipulated. The idea that there’s fake volume has been rumored for a long time; we were just the first people to systematically look at which exchanges were delivering real volume,”

Salient Points of the Bitwise Bitcoin Trade Analysis

In assessing the $27 million average trade volume (ATV) reported by San Francisco-based company, Coinbase Pro, the asset management company established a bitcoin “median spread” of one (1) cent. Median Spread is significant because it pertains to the difference between a bitcoin seller’s asking price and the price a bitcoin buyer would be willing to place as exchange. On Bitwise’s evaluation, Coinbase Pro’s trading scenario is legitimate.

Pitting the Coinbase Pro data against those that made a showing of having the biggest reported exchanges tracked by CoinMarketCap.com, Bitwise found bitcoin exchanges in most entities have extreme median spread.

Reported exchanges at CoinBene for one, resulted to a $15 median spread, which Bitwise found as dubious. CoinBene’s AVT was 18 times greater than that of Coinbase Pro. It therefore came as a surprise that such volume would come from a trading company that has a median spread that is 1500 greater than a cryptotrader like Coinbase Pro that has 1 cent median spread.

Not surprisingly, further analysis of reported bitcoin trading revealed median spreads as extreme as $300 and higher.

The fake exchanges are driven by fees awarded to those who can attract listings for fresh initial coin offers (ICO), targeting those seeking to have their cryptocurrency placed on where heavy trading transpires. Autonomous Next previously reported data showing fees ranging from $1M to $3M per listing; whilst suggesting the crypto cycle incentives promote fraudulent behavior from bad actors.