Cryptocurrencies – The Brighter and the Darker Picture!

Cryptocurrencies – The Brighter and the Darker Picture!
Published on

The growing popularity of cryptocurrencies is drawing considerable attention from all kinds of people from every corner of the world. Despite the fact that not all countries have made trading in these digital currencies legal, the rising demand for the investment of cryptocurrencies is alarming. The kind of returns obtained has made investors excited and has got them hooked to the world of cryptocurrencies. With big players already making great returns and planning to rely on cryptocurrencies as the medium of payment has had a positive impact on the retail investors. It is because of this that every common man is inclined towards cryptocurrencies with the sole aim of making huge profits just like other players in the market. However, there is a different side of the story that goes unnoticed.

What becomes critical here is that the investors should be well aware of the cryptocurrency market as a whole to be able to deal with every situation, no matter how unfavorable it turns out to be in the long run. According to a recent research from the UK's Financial Conduct Authority, the excitement pertaining to the rising valuations attached to cryptocurrencies has had a positive impact on the retail consumer market. Figures related to public awareness and the FCA's estimate for ownership are quite impressive. From last year's 1.9 million, the number now stands at around 2.3 million as far as public awareness and the FCA's estimate for ownership is concerned. Additionally, the number of adults who are aware of cryptocurrencies, at least to some extent, has increased significantly.

In addition to all this, the attitude of the people with regard to cryptocurrencies has also changed over the course of time. Gone are the days when a major chunk of people considered the cryptocurrency market to be one of the forms of gambling. Though there are still some people who are of the perception that investing in cryptocurrencies is as similar as gambling, the numbers have dropped significantly. Today, people see cryptocurrencies as a medium that serves as either a complement or alternative to mainstream investments.

However, what is alarming is the fact that not many are in a position to identify the definition of cryptocurrency from a list of statements. This throws light on the declining level of overall understanding of cryptocurrencies among investors.

Yes, cryptocurrencies have benefitted many but what cannot be overlooked upon is the fact that there are investors who have had a tough time as well. One of the major reasons for this turns out to be a lack of adequate knowledge and blindly investing without being aware of the risk and volatility involved.

Sheldon Mills, FCA's executive director, rightly points out that the cryptocurrency market has continued to grow, and some investors have benefitted as prices have risen, but at the same time, it is important for consumers to understand that since these products are largely unregulated, there is always some risk involved. He further added that if someone is planning to invest in cryptocurrencies, he/she should be prepared to lose all their money, if something goes wrong and things aren't favorable.

What everything boils down to is the fact that large gains, without a doubt, look fascinating but the possibility of an investor incurring heavy losses shouldn't be overlooked upon.

Join our WhatsApp Channel to get the latest news, exclusives and videos on WhatsApp

                                                                                                       _____________                                             

Disclaimer: Analytics Insight does not provide financial advice or guidance. Also note that the cryptocurrencies mentioned/listed on the website could potentially be scams, i.e. designed to induce you to invest financial resources that may be lost forever and not be recoverable once investments are made. You are responsible for conducting your own research (DYOR) before making any investments. Read more here.

Related Stories

No stories found.
logo
Analytics Insight
www.analyticsinsight.net