Over the last decade, the global economy has been observed proceeding towards a completely digital system. People are inclining more towards cashless processes. Be it an investment or a money transfer, the online payment sector has witnessed a new and exciting invention i.e. cryptocurrency. Many experts believe that this digital currency will play a crucial role in building the global economy in the upcoming years.
While many people are still into investing in the stock market, experts say that cryptocurrency is a better alternative. This year, we have witnessed the steady rise of Bitcoin. During the times of coronavirus pandemic, while the global economy is shuddering, the value of precious metals and cryptocurrency like Bitcoin has surged. The reason behind this is the shifted trust of significant investors from traditional financial investments to new investments.
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The traditional markets are adversely affected by COVID 19, which has led to the crash of these industries. However, it has been noticed that businesses with digital services and platforms have been more resilient against the economic slowdown resulting from the pandemic. The only drawback to these digital services is that many clients or consumers are not associated with this type of ‘Decentralised Finance’.
However, if you are confused about investing in stocks or cryptocurrency, here are 5 reasons why the latter one is a better option for you.
Lesser Fees Charged on Transactions
Except, the small fee charged for purchasing cryptocurrency from an exchange (1%-3% of the amount at the time of purchase) there are no fees associated with the coin. Once the coin is purchased, buyers have the option of simply holding on to the crypto in a digital wallet and watch it grow. As we all know the cryptocurrencies are highly volatile just like the stock market, history shows that cryptos like bitcoin even when it goes down, has not been decreasing below a certain level as it was last valued at before it dived. It has been seen that the coins have roared back and gone further up the growth track.
In contrast with the buying of stock, unless you are intrepid enough to try it solo, you will be required to trade a stock using a mutual funds broker. There are several charges that a trader in the stock market is required to pay, including transaction fees and broker fees and similarly other special fees that are associated with the maintenance of your account whether you will gain or lose on the stock or mutual fund investment. Also, it is very unlikely that the stock or mutual fund prices will rise the same way cryptocurrency is growing.
Cryptocurrency Market Hours
As it is decentralized digital cash, no government or authority has control over the process. Along with this, all transactions are done directly between traders on cryptocurrency exchanges across the world. However, due to time to time infrastructural updates, the market may stay down. Otherwise, the market is open throughout the day and the week
Bitcoin Provides Secrecy and Safety About Your Holdings and Worth
One of the main advantages of investing in cryptocurrency is its secrecy. No one but you and those that you choose to trust can know the value of your holdings. Because these are not yet subject to the regulation of the Security and Exchange Commission (SEC), like public stock corporations and therefore there is no “public” record of what you might be holding.
Stock, bonds, and mutual funds are subject to tracing which allows other people and the government to get into your business. However, the case is not the same as the cryptocurrency. Only the wallet where you store your crypto has any knowledge of what your account value might be. Wallets’ information is not shared with anyone, including the government except the owner of the account.
Better Liquidity
The measure of the time taken and efforts made to convert cryptocurrency into cash while making no impact on the market price is known as the liquidity of the asset. For faster transactions and better pricing, liquidity is considered as very important.
Cryptocurrency has Flexibility
Cryptocurrency can be used just like money on the spur of the moment whereas stocks cannot. Coins are not only an investment vehicle but its versatility is fantastic. Merchants and businesses all over the world recognize cryptocurrencies like bitcoin as a measure of money exchange for goods and services all over the world now. Big corporations like Overstock, Microsoft, Dell, Expedia, and thousands of other small and medium organizations are now welcoming cryptocurrency as a mode of payment.
On the other hand, stocks would need to be cashed out in currency first to do the same thing, however, again the fees and costs associated with doing all of that would have to be paid which lessens the amount of money that would ultimately be available for such purchases.
There is a projection that by 2021, crypto coins like Bitcoin will reach more than $100,000 thus transforming the financial system in the future. Despite all the leaps, these digital currencies have proved to be profitable. Those who bought Bitcoin at the beginning have experienced a return of investment of about 9,000,000%. If we compare Bitcoin’s 11-year performance with the best-performing stock ‘Netflix’, you will find that the early investors had got a return of 4,000%, which completely pales in comparison to that of Bitcoins.
So of course, cryptocurrency is a better investment option than stocks for getting better returns. However, to get the best crypto investment & trading experience, you should look for one of the best cryptocurrency exchanges in India. This is only when you can ensure to get the best profit from your investment.
