It is no secret that the concept of money is undergoing a metamorphosis nowadays and cryptocurrencies are at the forefront of the money making movement. They are the new IT thing in the world of money and almost everybody is caught in the maelstrom. The most popular of these new forms of money is the Bitcoin of course, but there are more including the Swisscoin, Onecoin and so on. Just like bitcoin, swisscoin and onecoin are also cryptocurrencies or digital currencies created and controlled using cryptography.
Cryptocurrencies have set the whole world a-buzzing with their radical changes to the concept of money. Unfortunately, many are yet to understand how these things work and as such, are liable to incur heavy losses in their attempt to join this sweeping movement. The Securities and Exchange Commission (SEC) has advised Nigerians to exercise extreme caution when investing in digital currencies.
The infamous Ponzi scheme, MMM Nigeria recently announced that its new mode of payment for participants of the scheme would be with bitcoins. This might seem like a double advancement in the world of financial investment and kill two birds with one stone. This investment is however fraught with dangers and you should research carefully and find out as much as you can about this digital currencies before taking the plunge to invest in them.
Why You Should Not Invest In Cryptocurrencies
1. It is Not Recognized by any Regulatory Agency in Nigeria
The SEC released a statement on Thursday, January 12, stating that none of the persons, companies or entities promoting cryptocurrencies had been recognized or authorized by it or by other regulatory agencies in Nigeria to receive deposits from the public or to provide any investment or other financial services in or from Nigeria. This means that there is no legal protection for investors in these digital currencies and any foul play cannot be redressed legally.
2. It is Volatile
Bitcoin values are unpredictable. It can increase or decrease over a short period of time. If you decide to invest, you should never invest money that you cannot afford to lose. Do not invest life-savings or equally important funds in them. You can’t be sure of the outcome of the investment. All in all, investing in cryptocurrencies should be seen as a high-risk asset.
3. It is Still Experimental and Undergoing Further Development
Bitcoin and others are all experiments of a new currency that is in active development. Every day, new discoveries are being made about the currencies and not all of the discoveries have positive impacts on the value of the currencies. There are still unresolved doubts about the future of these currencies and each new discovery might be the one to bring it all crashing down( that’s not much likely though). With each improvement comes new challenges, so if you decide to invest, be ready for problems.
4. Government Clampdown and Regulations
Some governments have expressed concern about the use of digital money. Some are already seeking to regulate, restrict or ban the use and sale of Bitcoins. However, some have explicitly allowed its use. This makes the investment in these currencies much harder and if you are in a country where it is strictly regulated or banned, you might have to move to a country where it is allowed, if you are serious about investing in it. Just remember these countries are not concerned about its use just for fun. They recognized an amount of danger in it which they are not willing to allow their citizens to explore.
5. It is Risky
It is inherently true that all investments come with a certain amount of risk. However, cryptocurrencies take the cake out of them all. Life is all about risks but some risks certainly don’t pay off. If you decide to invest in bitcoin, swisscoin, TBC, onecoin e.t.c, you should know that there is a very real chance of you losing your money. There are just too many things that can go wrong and all it needs is just one thing to go wrong. Bitcoin exchanges are entirely digital and are at risk from hackers, malware, and operational glitches. System failures are not out of the worries and they lead to an extreme loss of funds. There is no protection available to users or investors in these virtual currencies from financial losses. So, if you want to invest in cryptocurrencies, be prepared to take one of the biggest risks of your life. Or at least close to it.
So, if you want to invest in cryptocurrencies, be prepared to take one of the biggest risks of your life. Or at least close to it.
Now, there you have it. Crypto’s are the bomb now both literally and figuratively. I’d advise you to try as much as possible to stick to the figurative side, but the ball is in your court.
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