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Dora’s Thoughts

I wrote this blog post because I was unsure about investing in cryptocurrency. I have heard both positive and negative things about it in the past, so instead of making assumptions, I decided to research it and write this post.

SPOILER ALERT: Now that I’m familiar with the topic, I’m not going to do anything with my hard earned money. In today’s post I’m going to cover some of the risks you need to know before you invest your money.

(Your mileage may vary.)

What is Cryptocurrency?

Crypto currency is a digital payment method that uses cryptography to secure transactions, control the creation of additional units/coins and verify the transfer of assets. There are hundreds of cryptocurrencies in existence.

With crypto currencies being so new, there are many opinions on whether or not they will succeed in the long term. As with any investment, you should do your research before investing any money into cryptocurrency.

Crypto currency is not like regular money-it has no physical presence or backing. It fluctuates in value due to market forces alone, and people are buying into this new kind of money because they believe it will continue to increase in worth over time as more people understand its true potential for expansion throughout many industries around the world.

On the Positive Side…

  • Cryptocurrencies use cryptography to secure transactions and control the creation of new units. They are not controlled by a single individual or government, but rather operate outside of central banking systems.
  • The value of cryptocurrencies fluctuates constantly, so traders speculate on the price movement rather than buying them for the long term.
  • Cryptocurrencies are digital, encrypted currencies. They work outside the control of the traditional banking system.
  • Cryptocurrency trading is done with a CFD account or buying and selling the underlying coins via an exchange. Cryptocurrency trading has been around for a while now and is becoming more popular every day. It’s speculative in nature, not just a tool for finance, but can be used as such if you have experience doing it.
  • Cryptocurrency is becoming more popular every day, as people are beginning to understand the benefits of this alternative form of currency.
  • It’s a fast-growing and disruptive industry that has been under scrutiny in recent years because it can potentially lead to financial instability. However, there have also been improvements made recently which make crypto valuable for investors and traders alike.
  • One of the biggest benefits is how easy it can be to get started. You don’t need any previous experience or knowledge, you just have to create an account and start trading! It’s also incredibly convenient because you can trade on your phone or computer wherever you are.
  • The world is quickly moving towards a cashless society and it’s happening faster than we think. Cryptocurrency will play a major role in this transition and it’s important to be informed about the options available.

CAVAVEAT EMPTOR (let the buyer beware)

  • Cryptocurrency has many advantages and disadvantages like any other form of money, with one major difference: it’s decentralized; meaning no single entity controls or backs it up.
  • Cryptocurrency is a digital or virtual currency that uses cryptography for security. They are not issued by any government, bank, or central authority. Instead, transactions are verified by network nodes through the use of miners who have powerful computers solving difficult mathematical problems and then record it in public ledgers which anyone can verify to confirm their legitimacy without needing a centralized intermediary such as PayPal or Visa/Mastercard, etc.
  • There has been no legislation in place concerning cryptocurrencies yet; they are currently unregulated by countries because there was not enough time before this new technology took off globally.
  • Unlike fiat money, crypto currency does not have any ethical policy or terms and conditions.
  • The total market cap for cryptocurrencies is estimated to be $324.716 billion by 2021. There are an estimated 4,928 currencies in use today that have not been listed yet and a large majority of these currencies will fail due to different reasons such as being abandoned, busting, or ending up being exit scams. While some crypto projects last forever and others were created just for fun or as a test, there is still plenty of room for many more cryptos out there that could make it big.
  • There is no cost to converting cryptocurrency. However, the process of exchanging crypto into flat money or vice versa can be costly depending on the market prices at the time of exchange.

Final Thoughts

As I wrote above, cryptocurrency is too volatile for me to invest my money. So, as a last word of caution, anyone can create a token and market it as a scam or as a valuable cryptocurrency. You need to do your homework to know whether or not this is a legitimate currency that you want to invest in.

Links used to research this blog post

DISCLAIMER: Dora’s Corner cannot guarantee that any information provided in this blog post is complete, accurate, or up to date.

Happy Trails,

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