If you bought one bitcoin at the beginning of 2017, by December, you were sitting smug at a profit of around 1400%. The leading cryptocurrency soared from below $1000 in January 2017, to around $18000 by the end of the year. Although the price has since fallen, those who bought bitcoin at the beginning of 2017 still stand to make huge profits at the current price of around $15 000 a coin.
Cryptocurrencies: The Craziness
The thing that makes cryptocurrencies such a crazy proposition for investors is their volatility. The “normal,” investor thrives on stability and control over various market fundamentals. However, with cryptocurrencies, the world of investment is turned upside down.
Advantages and disadvantages of investing in Bitcoin
Bitcoin and other cryptocurrencies are, by their very nature, unregulated. There is no big brother government looking over your shoulders and demanding an unfair share of the profits as taxes.
Its also an arena where fortunes can be made in a very short period of time. Needless to say that these same fortunes can also be lost in an even shorter period of time.
Bitcoin represents a true currency jungle. While this can be an attraction, the fact remains that you need to be fortified against high blood pressure before investing in any of the cryptocurrencies that are out there.
With bitcoin, one is never sure when the pyramid will come tumbling down. It all feels like a house that’s build on quicksand. Again, a major attraction for the risk loving investor. And where there is risk, there is often reward, as was seen in 2017.
However, the fact that this digital currency tanked towards the end of the year is what keeps “sane,” investors from joining the bitcoin bandwagon.
Meanwhile, in Venezuela
In spite of the fluctuations, there can be no doubting the fact that bitcoin has turned out to be a worth investment. If, like many, you waited before throwing in your money, then it may already be too late. At over $10000 a coin, not many ordinary citizens of the globe will be able to buy bitcoin.
Although it is possible to invest small amounts, one gets the feeling that bitcoin is pricing itself out of the reach of the penny investor.
Meanwhile, in Venezuela, so attractive has bitcoin been that the government in this troubled country has reportedly begun setting up its own cryptocurrency. This move, one has to say, reeks of desperation. If people have no confidence in the country’s real currency, who is going to trust it in the murky world of cryptocurrencies?
Bitcoin: The outlook for 2018
Some people are already projecting that bitcoin will rise to as high as $60000 in 2018. While that remains to be seen, there can be no doubting the fact that this digital currency will see wild fluctuations as the year goes by. The craziness that was witness in 2017 will, without doubt, continue.