It can now be said that cryptocurrencies have become the center of attention of a certain group of investors. Especially when compared to traditional investment instruments. advantages Because of this, people may prefer to invest in cryptocurrencies.

Well especially in the younger age group What are the logical reasons for cryptocurrencies, which are considered as one of the important investment instruments in investing, over traditional investment instruments such as gold or dollars?

First, let’s get acquainted with cryptocurrencies and traditional tools.

First of all, it wouldn’t be wrong to define traditional investment tools with the following words: Low risk, low return and long term investment objectives. For example, stocks and bonds usually offer regular returns, but their prices are not very volatile. On the other hand, gold and other commodities have been the safe haven for most people in times of crisis, but it can be said that they provide less returns on long-term investments.

On the other hand, we can define cryptocurrencies with the following words: Higher risk, higher return potential and higher volatility. In addition, the fact that cryptocurrency markets are less regulated can also bring other risks. However, cryptocurrencies are distinguished by their low costs and fast transactions, secure payments, decentralized financial (DeFi) applications and technological innovations.

Let’s get into a little more detail: what aspects of cryptocurrencies stand out?

First of all, of course, a high earning potential

One of the main reasons why cryptocurrencies are gaining popularity day by day high earning potential We are not wrong when we say that it is. Especially during the pandemic period, the fact that Bitcoin reached the $64 thousand level and then the rise of other cryptocurrencies made cryptocurrencies catch the attention of everyone from 7 to 70.

The reasons for the sudden increase and decrease of cryptocurrencies do not end with counting, but balance between supply and demand and speculation (e.g. Elon Musk tweets about Dogecoin out of the blue) as the main reasons for the extreme activity in this market.

One of the important details for an investor: quick and easy trading

In traditional financial markets, transactions are usually to intermediate institutions is necessary. As such, it takes time to process and transaction fees can be high. On the cryptocurrency side, things don’t work that way. Because transactions can be transferred directly between individuals, intermediaries are eliminated and trading becomes easier.

In addition, we often hear day opening and closing times It doesn’t exist in the cryptocurrency industry and the reason is quite simple: the cryptocurrency space has a 24/7 market.

Here are such advantages that trading cryptocurrencies is much more convenient than traditional tools. fast and easy We wouldn’t be wrong if we say these are the factors that make it happen.

Another missing feature in traditional investment tools: decentralization

One of the beauties of blockchain technology decentralization it can be tried. This concept is actually one of the most important words in the world of cryptocurrency and allows it to stand out from traditional investment tools.

For example, unlike stock markets, cryptocurrencies state or central authority cannot be manipulated. Therefore, they can be a safer investment tool for users. Moreover, it is very difficult for cryptocurrencies to be stolen and counterfeited thanks to the encrypted and decentralized system. Of course, it might be better if you rely on these features and don’t click on every link on the internet that you don’t know.

to cut a long story short

While the values ​​of cryptocurrencies, the shiny investment tool of recent times, are showing more volatility compared to some traditional investment tools, long-term can generate significant profit. It can be argued that the rise in the value of cryptocurrencies such as Bitcoin in recent years has caught the attention of investors.

However, let us remind you again and again that investing without knowledge of cryptocurrencies carries great risks. Since the prices of cryptocurrencies can change quickly, one wrong move can frustrate the investor. to great losses it can hurt. Therefore, it is not bad to do proper research and follow the markets before investing in cryptocurrencies.