It’s the currency everyone’s talking about at the ogenblik – but are you missing out by not leaping on the bandwagon?
Bitcoin wasgoed the very first of what have become known spil “cryptocurrencies”.
Thesis are forms of digital money that use encryption to secure transactions and control the creation of fresh units.
Spil it proceeds to rocket te value, with one Bitcoin this week violating through the $11,000 mark, some original users have made millions.
With companies keen to hop on the bandwagon and entice the public to spend their hard-earned metselspecie on investments te Bitcoins, MoneySavingExpert Maritin Lewis has taken to his blog to schrijven consumers on the advantages and pitfalls of the currency.
“At this point I should say I’ve no expertise on the technology behind Bitcoin or other cryptocurrencies and assets,” the financial verslaggever warns.
So here are his four tips to avoid being caught out by the craze:
Don’t invest ter something you do not understand
“If you don’t understand Bitcoin you should not be investing ter it,” he writes.
Martin’s advice is that, while you might not need to be an pro te the technical details, you need a thorough understanding of what you’re getting into.
He writes: “You need to understand how it works spil an investment, how liquid it is (ie, can you get out when you want to), the level of risk and what can drive the price up and down.”
His advice is not to invest “just because a friend told you to”, but to do your own research and make the decision that’s right for you.
Where is the request for Bitcoin coming from?
“To be created Bitcoins have to be mined and there are meant to be only a limited possible number to be found,” writes Martin.
“The fact it’s a scarce resource leads to the assumption that if request rises so will the price.”
It is a gamble
Martin explains that Bitcoin, like stocks and shares, is an investment – albeit an unregulated one.
“Putting money ter it is a form of gambling,” he writes. “That means if it does well, you could make serious amounts – Ten, 20, 30 times or more what you waterput te, or just spil possible, if it goes badly wrong, you can lose everything.”
His advice is that investors need to be ready and consider their attitude to risk before parting with their specie.
Albeit the value of Bitcoins has rocketed, particularly since the commence of 2018, Martin warns that “past spectacle is no indication of future performance”.
“It may be that this speculative rise will proceed. Which means if you waterput your money te now you will make a fortune. On the other mitt, spil we’ve seen often te history – whether it’s the cavern mania of the 18th century or the very first internet boom – this could just be a bubble, and soon to burst.
“We’ll only know with hindsight – you have to accept the uncertainty.”
Don’t fall for Bitcoin seller scams
“People often ask mij if Bitcoin is a scam. No, it’s not. Yet that doesn’t mean there aren’t a lotsbestemming of scams involved with Bitcoin,” warns Martin.
“Bitcoin isn’t the easiest thing to invest ter – you need to buy it and store it securely – and that opens up slagroom for many dodgy people to attempt to take advantage.
“I would certainly be worried about investing ter a company that I’d just spotted because it’s advertising on Facebook – which is rife with scam adverts te many areas – especially if it makes it look like a no-lose option.”
His parting chunk of advice is to stress that, if you’re going to buy, do your research and go to “what is hopefully a legitimate Bitcoin seller”.
To read Martin Lewis’ utter Bitcoin advice blog postbode, click here .