reblog

The interest in cryptocurrency has risen exponentially during the pandemic. As people had relatively more time and money to spare, they started exploring crypto trading. Since it is such a new financial asset, there’s a lot of curiosity around it. So much so that it led people into voraciously reading the viral Reddit thread which now has a category called ‘meme stocks’. 

When cryptocurrency first came into existence, only a niche audience was familiar with it–often referred to as anti-establishment investors. However, today its popularity has grown manifold and experts predict that the cryptocurrency market is likely to triple its worth by 2030. Expected to grow by almost $5 billion in less than 10 years, it is highly unlikely that brands and investors can continue to disregard the growing importance of cryptocurrencies. 

Whether cryptocurrencies need to be regulated or not is something that will become clear in the future. For now, let’s dig deeper and understand the nuances of cryptocurrencies. 

Power to the people

Even though there has been a steady rise in the number of people who are actively trading cryptocurrencies, the growth in recent years has been remarkable. Investors are also diversifying their profile and thus, at a time when meme stocks and stimulus checks are trending, crypto trading is more than just a hobby. It is now increasingly being viewed as an asset that can bring significant profits despite the risks involved. 

If we draw a parallel with how consumers responded to crypto in 2018 versus how they back it now, the trend is in favour of cryptocurrencies. In fact, cryptocurrencies offer a new platform of investment along with the kind of liberties and freedom that is not common in traditional forms of investments like banking. 

What worries the investors!

Given the ever-rising value of cryptocurrencies, traditional institutions and financial bodies are keen on investing in them. To put the weight of these demands into perspective, the U.S Bank has recently created a Bitcoin custody service, the purpose of which is to enable hedge funds to have a stake in cryptocurrencies. Now, this is paradoxical because having a bigger pool of investors implies that digital currencies would also end up operating in a similar fashion to traditional modes of investments. 

Here’s how:
 

• Now that institutional players are pouring funds into the crypto market, the power structure is changing constantly. If you look at why and how cryptocurrencies were created 13 years ago, it was an attempt to bring together users who wanted an alternate and an exclusive financial world. The point was to be able to create an ecosystem where moving money and carrying out transactions is easier as well as more accessible. 
• Unlike traditional banks, you don’t need to have an address to trade in crypto; all you need is an internet connection. Cryptocurrency, in principle, relies on the collective actions of everyday users for self-regulation. They keep the ledger of transactions – the blockchain – secure and updated, and the process allows anyone with a computer the ability to mine coins.
• At present, the expected future of cryptocurrency appears to paint a very different picture. Being a crypto enthusiast is no longer about being a tech-savvy individual who likes to mine bitcoins. In fact, individual miners aren’t even the ones who are earning profit. This territory is now dominated by a handful of organizations that pool in their resources to mine bitcoins as it requires a great degree of computing power and electricity. While this makes the process faster, it does little to help individual miners or hobbyists. 
• Another example of how institutional investments make the tables turn is Tesla's contribution caused a 20% jump in bitcoin’s price which raised questions about the blockchain’s democracy. 

Can you have your cake and eat it too?

It is a fact that governments haven’t exactly been very prompt in creating rules and regulations for cryptocurrencies. While fiat currencies are tracked and moderately closely, cryptocurrencies have spread their wings and network almost on their own. What has so far been a decentralized financial network is likely to come under some regulations soon as even investors are in favour of it. However, the jury is still out on what these regulations should cover and who should be responsible for formulating them. 

Regulations in the cryptocurrency marketplace will be helpful in making it legal across geographies. It would also tone down its volatility and prevent fraudulent activities. However, some analysts believe that regulations would be detrimental to the peer-to-peer network, which cryptocurrencies operate in. It would end up taking away the main USP on which the market thrived, that is the freedom that comes when there are no intermediaries overseeing transactions. 
 

The cryptocurrency market has been a profitable one largely due to its volatile nature and the anonymity it offers. With regulations, this is compromised in return for investors’ protection and of course stability. That said, it is also worth mentioning that it is in fact hard to operate a currency that has reached a valuation like cryptocurrencies without any regulation. Therefore, the only solution here is to try and find a neutral ground where all parties operate and flourish harmoniously. 

The uncertain way forward

Do cryptocurrencies have a future? If yes, what is that future is something that one needs to wait and watch. Being perceived as a volatile market in terms of prices and also in how the consumers view it, it would be interesting to witness how cryptocurrencies evolve with time. For now, given the lack of clarity in terms of regulations and government policies, it appears as though investors would have to navigate through challenges and paradoxes in order to earn more. So to conclude, if cryptocurrencies have a future, it would be one that is entirely shaped by regulators, financial brands, and governments. One can only expect and hope that adequate, as well as necessary steps, would be taken to educate traders and safeguard all investments. 

At present, it is clear that the cryptocurrency market has a lot of unexplored potentials which when explored properly and be a gamechanger.

Visit here to buy and sell crypto instantly.

References:

https://josheph.substack.com/p/which-cryptocurrency-is-best-to-invest?s=r
https://bitbucket.org/joshephlewis/crypto/wiki/What%20is%20cryptocurrency%20mining%3F
https://www.cryptobite.co/how-to-trade-cryptocurrency/
https://financial-co.tribeplatform.com/general/post/how-does-cryptocurrency-value-move-QMjEKDrVyilL6NQ

The investment that helps one to track the index of the market and that is generally made with bonds and stocks is called the index funds. Generally, the index funds are invested in all the components that include the index that they track and also they have the managers for the fund who ensure that the index funds work the same as the index. The three steps that one should follow while investing in indices or index funds are as follows:

•          Choose the index that you as an investor would like to track

•          Select the fund that will track the index that you have selected 

•          Buy the index fund shares

Let us learn what this means.

Choose The Index

There are numerous different types of indexes that one can follow using list holds. The most popular rundown is the S&P 500 Index, which recalls 500 of the top associations for the U.S. monetary trade.

In any case these extensive records, you can notice region records that are joined to express organizations, country records that target stocks in single nations, style records that highlight rapidly creating associations or worth assessed stocks, and various records that limit their theories considering their isolating structures. Along with the index, another important thing is the platform. One should choose platforms like the forex traders to invest in and choose index funds.

Select The Fund Of Your Index

Whenever you've picked an index, you would generally be able to notice something like one record hold that tracks it. For remarkable records like the S&P 500, you may have something like twelve options by and large after a near report.

You may have more than one index store choice for your picked record, you'll need to address several focal solicitations.

At first, make sure that you know which record save most enthusiastically tracks the presence of the overview. Second, which record store has the least expenses? Third, would there say there are any impediments or limitations on an overview store that keep you away from putting resources into it? Taking everything into account, does the asset supplier have other record funds that you're moreover excited with regards to utilizing?

 The responses to those solicitations should make it all the more obvious to pick the right record put something aside for you.

Buy The Index Fund Shares

To buy shares in the index fund that you have chosen one should usually open a record directly with the common resource association that offers the resource. Then again, you can open a venture store with a vendor that grants you to exchange parts of the document save you're enthusiastic about.

Again, in closing what course is best for you to buy bits of your record hold, it pays to look at costs and components. A couple of experts charge extra for their customers to buy record store shares, making it more affordable to go clear through the rundown hold association to open a resource account.

Anyway, various monetary patrons like to have all of their hypotheses held in a single currency market store. In case you hope to place assets into a couple of assorted rundown saves introduced by different resource bosses, then, the lender decision can be your most ideal method for joining all of your theories under a singular record.

Why Should You Invest In The Index Funds?

Placing assets into list saves is one of the most un-requesting and most effective ways for monetary patrons to make monetary prosperity. By basically matching the extraordinary show of the money related business areas over time, record resources can change your premium into an immense reserve fund after a long enough timeline - - and best of all, you don't have to transform into a monetary trade expert to make it happen.

The investors who invest in the index funds find these useful for plenty of reasons:

•          Limit your time spent exploring individual stocks. Considering everything, you can depend upon the asset's portfolio chief to put resources into a once-over that now intertwines stocks you truly need to put resources into.

•          You can contribute with less danger. Most archives join unassuming packs or even many stocks and different theories, and the overhaul leaves you more reluctant to experience gigantic disasters expecting something horrible to happen to a few relationships in the summary.

•          Trade Indices saves are accessible for a wide assortment of speculations. You can purchase stock archive assets and security record saves, which cover the two huge pieces of an enormous number of people's hypothesis structures. Notwithstanding, you can also purchase more associated with grind maintains that drill down into express pieces of the cash related business regions.

•          It's essentially more sensible. Index saves are commonly unquestionably less unnecessary than choices like suitably overseen saves. That is because a record save chief needs to purchase the stocks or different interests in a summary - - you don't need to pay them to try to consider stock picks of their own.

•          You'll cover less in charges. Index saves are very examination valuable separated and different theories. For example, list holds don't need to do as much trading of their resources as satisfactorily managed stores, therefore list saves try not to convey capital acquires that can be put on your evaluation tab.

•          It's significantly more direct to stay with your contributing arrangement. Precisely when you use index saves, you can ordinarily contribute dependably and disregard present second reassuring and less uplifting events, sure that you'll take an interest in the fairly long progression of the market.

Why People Do Not Invest In The Index Funds?

Index funds might be easy and simple but not everyone can do it. Following are some of the demerits or downsides of index funds investing has:

•          One will never be able to beat the market. The index funds are generally designed to match solely the performance of the market therefore one would want to prove the mettle as the investor and the funds of the index that won’t be given the chance. 

•          One does not have the protection loss. The funds of the index being tracked by the market in the good times and even when the times are bad during market plunges. The index funds will plunge as well.

These are some of the reasons why not everyone trade or invest in index funds.  Forex traders is a good platform for you to invest in index funds as it is safe and secured. If you want to invest in index funds make sure that the platform you should is good.