Bobos & Wojaks

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4 Major Risks You Should Know Before Investing In Bitcoin

Because Bitcoin and all cryptocurrency, for that matter, is such a new currency and market, its price is very volatile. It is not uncommon for the price of Bitcoin to fluctuate dramatically within a single day, or even within minutes. As a result, trading is a risky endeavour. Fundamentals would often support currencies in general. However, Bitcoin is not yet a fully functional currency, and its “fundamentals” are continually evolving.

 

So here are some risks of investing in bitcoin :

  1. A fatal and not fixable flaw in Bitcoins code. Bitcoin has been around for years, so this is very unlikely.
  2. Working quantum computers. Should this happen, we face other problems because encryption as we know it would become obsolete. Including email, banking, … In my judgement not very likely to happen during the next 10 years.
  3. A concerted effort by major nations to ban Bitcoin. Yes, it is decentral. Nevertheless, should Bitcoin become outlawed by such an action, this would massively hinder its development. Very unlikely, that this scenario will come through.
  4. Global breakdown of the Internet. Can only happen during a catastrophic event (global war, giant solar flare with power outage). If this happens, the failure of the Bitcoin network is the least of our problems.