Investors are concerned every time Bitcoin price fluctuations occur.
Just when more retailers began accepting Bitcoin for payments, it seems that there are rumors from government officials who are concerned about the use of cryptocurrency.
Since it's a decentralized currency, the government can't track transactions made with cryptocurrency, leading to laws and regulations being proposed and/or implemented.
If you're just starting to learn about digital currencies or are considering adding them into your investment portfolio, this guide can help you decide whether Bitcoin is a good choice for you.
There are pros and cons to Bitcoin – just like with any investment – that are worth considering. And before we go into these pros and cons, let’s take a look at what Bitcoin actually is from a high-level perspective.
Bitcoin is a digital currency that allows people to send payments from one person to another. It is not issued by any government or central bank, but instead is created and managed through an open-source software program.
It was created in 2008 by a man using the pseudonym Satoshi Nakamoto and went into use in 2009.
Bitcoin is not controlled by any single entity like a central bank or financial institution. Instead, the transactions are recorded on a public ledger that is shared among all the users of the currency. This public ledger is called the blockchain, and it verifies and records all transactions that occur on the Bitcoin network.
In order for a transaction to occur on the Bitcoin network, it needs to be verified. Due to the verification process, Bitcoin is viewed as being a very secure form of digital currency. People are using Bitcoin for international payments, to buy pizza and purchase real estate.
Lawyers are even accepting payments for legal services with Bitcoin.
Why would you use Bitcoin? There are several pros to using this cryptocurrency that include but are not limited to, the following:
While there are a lot of great advantages of using Bitcoin over fiat currency, there are also disadvantages that you need to consider, too.
There are a lot of benefits to using Bitcoin, but with anything new, there are also cons that need to be considered, too.
As you can see, there are both good and bad aspects of Bitcoin. Once you know how to use Bitcoin for payments, you can begin buying goods with the currency.
But do not put all of your investments into crypto due to the high volatility of the coin.