Once the central bank in bank accounts and limited the sum of money that may be withdrawn from bank accounts it created a huge uproar that was felt across the world. If consumers did not need access to money how could they buy and sell the items had a need to carry on inside our modern world? The truth is they can’t so consumers around the world started to consider safer alternatives to fiat currency. Fiat currency is currency that has no tangible value apart from what the government assigns to it.
Consumers are buying a solution to store their buying power to protect themselves from having bank accounts frozen for indefinite periods of time. Lots of people Spice started trading in Bitcoins. This is a crypto-currency which means it cannot be easily counterfeited but before anyone starts buying into this new currency it will be prudent to know the risks.
Bitcoins are not issued by any central bank or government so there’s no accountability whatsoever. If you should be working with Dollars,Euros or Pounds you’ve the assurance that the government behind it will honor the debt while Bitcoins do not provide any guarantees at all. The fact that no body truly knows who made this currency so there’s no way of knowing whether it could be stolen from under our eyes.
These Bitcoins are stored inside a digital wallet which can be encrypted on your own computer. While this will provide a sense of security if your computer is lost your Bitcoins are gone as well. It’s nothing like a credit card where you are able to get an alternative and carry on like nothing has happened.
As the security with this currency is really a concern undoubtedly the greatest worry is the value of it. The perceived value of a Bitcoin can alter in a minute and unlike fiat currencies that are backed by hard assets owned by a nation if a Bitcoin value drops you’ve nothing of value at all.
There are a few exchanges around the world that sell and buy Bitcoins, but you shouldn’t get them thinking they will rise in value. They are an electronic digital commodity which some would classify as a “fad “.Tomorrow it may lose all its real value and never recover.
So to recap the risks, you do not have any real security with Bitcoins since they will be not provided with a government. The value if highly volatile and could be reduced to zero in a heart beat and the easy fact that the currency has only existed for some years shows it’s not proven to be reliable.
If you should be buying a solution to preserve value then precious metals like gold,silver and platinum may be more beneficial since they’ve been useful for centuries as a moderate of exchange.
In regards to investing you ought to never make rash decisions but weigh the risks and potential payoff and remember that there’s no sure things when it comes to digital currencies like Bitcoins so approach at your own risk.