Today, almost everyone knows what Bitcoin is. This cryptocurrency has become popular because of its rapid growth. But also Bitcoin has become a key element in the stories about hackers and the Dark Web.
There is also Ethereum with capitalization about $30 billion, and Bitcoin Cash, which separated from the original Bitcoin on August 1 in 2017. It lost about half of the value in a few hours, and the next day rose by almost a quarter. In general, there are more than 800 less valuable cryptocurrencies.
There are some obstacles on the cryptocurrency way to mass adoption. Investors should have a good understanding of online technologies and trust them to use the cryptocurrencies exchange. There are stock exchanges, which require users to pass difficult and slow identification process, and some states do not allow their citizens to invest in them. But over time, the work in this market is becoming easier.
Why Millennials like cryptocurrency?
For many years cryptocurrency has remained a niche market for the tech-savvy people, who enthrall the idea of a decentralized financial network, but today it seems that we have come close to their widespread adoption. According to the research, 27% of Millennials are willing to invest their money in bitcoins.>/cite>
For obvious reasons, cryptocurrencies especially popular among Millennials, who have grown up in the financial crisis, and now see the rise of the anti-globalization populism that threatens the stability of the international economy.
Unlike previous generations, many of these young investors don't have retirement as well as mutual funds. The traditional way to stability for the middle class becomes worse because of the exorbitant housing costs and unsustainable labor market. So these investors see cryptocurrency not only as a hedge against another collapse but as the most rational and utopian way - the way to preserve and multiply their money.
33-year-old Sebastian Deans, chief operating officer of food manufacturer “Cheeky,” got his first job after College in 2007. As soon as he had accumulated a sufficient sum to invest in the stock market, he decided to take a chance to get a higher income. Six months later the market crashed. Now he invests the bulk of his money in cryptocurrency. Many of his peers share his skepticism about the traditional markets.
He is not the only one who hopes that cryptocurrency will help solve his financial problems. You can find a lot of speculators on the discussion forums who believe the digital currency to be a lottery ticket and look forward to extraordinary profits. For those who barely make ends meet or cannot pay off the loans, the slightest chance that an investment of $100 can turn into $100 million, is simply too tempting. And that is what would happen if they put the money in Bitcoin in 2010.
According to the research, 27% of Millennials are willing to invest their money in bitcoins. These results are not surprising, as bitcoin this year surpasses all other types of financing significantly. The survey also showed that 42% of Millennials are familiar with bitcoin.
Of course, a lot of people do not share the optimism about the cryptocurrency, arguing that we witnessed an enormous bubble in the digital market. Critics believe that the unprecedented cryptocurrency growth associated mainly with the speculative trade in Japan and South Korea, and indicate past landslides of bitcoin as the basis for skepticism.
What threatens you?
Even users savvy enough to use two-factor authentication may not know about the benefits of “cold storage,” where your money is stored offline (e.g., on a computer without the Internet connection). There is no one to ensure your money against loss. If they disappear, say goodbye to them.
And even if your money is protected enough, expect the typical investment risks, enhanced by the cryptocurrency volatility. The cost of the same bitcoin can fluctuate by 10-15% during the day — often because of the speculators' actions who are trying to manipulate the price of an unregulated free market.
For this reason, very few investors are trying to cash in on price movements, preferring the long-term investment. Experts advise to buy bitcoin and forget about it. Don't be tempted by obtaining short-term profits. But even long-term investors often can't resist the temptation to monitor the price regularly — the excitement is too big.
Many cryptocurrency holders see it not only as a profitable long-term investment but also as a means of struggle for social justice. Many e-money has no value, except for the theoretical possibility of their use as alternative currency. Lots of them start out as a joke and suddenly gain popularity among speculators (e.g., Dogecoin is a cryptocurrency dedicated to the dog of the Internet meme, with a market capitalization of about $200 million). But the biggest altcoins, namely, Ripple and Ethereum, bring tangible benefits to the real world and are accepted by banks and financial institutions.
Meanwhile, cryptocurrency supporters actively preach their views among friends and relatives. Most understand that investing in cryptocurrency will not help to get rich quickly. Many perceive the purchase of digital money as a long-term investment that will ever provide a dignified old age.