Cryptocurrencies are getting better every day. It keeps increasing your wealth like your viral posts on social media. A contagious financial tool for a good portfolio and a catalyst for growth. An interesting fact is that there are more than 5,000 cryptocurrencies.
2021 has been a fantastic year, but what's next?
Let's raise the situation here. Both Bitcoin and Ethereum have hit the bar for higher performance. Long-term investors rely on it. As you read this article, there may be more good news about cryptocurrencies. I will try to present the possible future of cryptocurrencies here.
The new regulations are currently in effect. They are under the carpet. Steps have been taken to minimize the risk of cybercriminals. The goal is to make this investment a safe tool for people to use. For example: China announced in September that all cryptocurrency transactions are illegal. Clear regulations will remove all barriers to make trading safer.
How will the new regulations affect investors?
The IRS will find it easier to track tax evasion. Investors can record transactions transparently. For example: capturing capital gains or losses on crypto assets has become easier. On the other hand, cryptocurrency prices are also affected in volatile markets.
ETF eligibility – important factors to consider
Bitcoin ETF debuted on the NYSE. This will help investors buy cryptocurrencies from existing investment companies. Due to the increasing demand, both the stock market and the bond market can cope. Let's look at it from an investor's point of view. Easier access to cryptocurrency assets helps people buy them easily. If you plan to invest in a Bitcoin ETF, keep in mind that the risks are the same as for any other cryptocurrency. You have to be willing to take risks. Otherwise, there is no point in investing your money.
What's in the future?
Bitcoin is the best in the crypto market. It has the highest market capitalization rate. In November 2021, the price rises to $68,000, in October the exchange rate is $60,000, in July - $30,000. There are large fluctuations in market prices. Experts advise keeping the cryptocurrency market risk in the portfolio below 5%. Talking about short-term growth, people are hopeful. Bitcoin price fluctuations are a factor to consider. If you want to play long, the short term results shouldn't bother you.
Looking at it from the point of view of increasing your wealth is not a good solution. Stick to traditional investment vehicles other than cryptocurrencies. For example: If you want cryptocurrency as a retirement savings tool, it's time to reconsider your decision. Keep your investments small and diversified. This reduces risk factors. At the same time, you have more time to think about cryptocurrencies.
You need to spend your money wisely and then invest in cryptocurrencies. One has to assess the associated risk factors and make a decision. I hope this article helped you.