You might know a little about the basic cryptocurrency concept, but you’re reluctant to invest in it yet. However, it’s hard to stay away from this market when you keep seeing newly-minted crypto millionaires and commercials for crypto investing starring celebrities. Several crypto ads aired during the Superbowl, and the entire world saw them.
But what is cryptocurrency for? What do these tokens do? Why are they worth money? We’ll run through some crypto facts in the following article. Knowing more about this technology and its uses and limitations can help you decide whether to try it.
If you’re new to the concept of cryptocurrencies and want to gain a deeper understanding, enrolling in Web3 courses can be a great starting point. These courses are specifically designed to equip individuals with the knowledge and skills needed to navigate the complexities of blockchain technology and decentralized finance.
You Can Buy Crypto and Lend It Out
Many people like crypto because they think they can earn passive income through it. You can do that by purchasing crypto and then storing it on one of the popular platforms, like Nexo. Many of them exist now, and new ones keep appearing.
A platform where you store your assets will pay you interest if you keep your crypto there, so you can make passive income that way. Of course, you need to have enough money to cover your essential expenditures like rent, mortgage payments, utility bills, etc., to use this model.
You can also lend out your crypto and charge interest for it. If you have one Stablecoin or another, that’s a prime crypto candidate for you to lend. You might want to consider Stablecoin lending because there’s less volatility than you’d get with some other crypto forms.
A Stablecoin is a crypto form that is not so unpredictable. That is because it’s pegged to a fiat currency like the US dollar, so there is virtually no price fluctuation.
More Companies Than Ever Accept Crypto
You might hesitate to try crypto because you’re worried that not enough merchants accept it yet. You’ll find if you do some eCommerce shopping that more merchants than ever take crypto these days. They may not take all the many varieties in which you can invest, but they’ll usually take ones like Ethereum or Bitcoin.
You can have Bitcoin or Ethereum standing by in a crypto wallet, and you can use those funds from that wallet to pay for something you want. It’s a simple, easy transaction in most cases. As more time passes, more eCommerce businesses accepting crypto should become the norm.
Accepting Crypto Can Help Your Business Succeed
If you run a company, accepting crypto sends a message to your workers and customers that you’re not afraid to embrace the latest technology. If you take crypto for your services or products, you can bring in a new generation of customers who otherwise might not buy from you.
You can also partner with international entities more easily. You might agree with an international company to buy parts or products from them and pay them in a crypto form to which you both agree. They can buy anything from you that they need with that same crypto form.
You can even pay your workers with crypto if they seem interested. Some professional football players made headlines this past year for asking their teams to receive payment in Bitcoins. You can offer your workers that option, but you can still allow them to get their paychecks in US dollars if they’re not ready to make the leap.
Crypto Assets Can Lose Money
On the negative side, you should know that crypto markets remain pretty volatile vs. more traditional currencies or investment tools. You can’t lose money if you put it in a CD. Something like a mutual fund offers more security because that’s an investment that’s not tied to one specific asset but many.
If you buy crypto and try to hold or trade it, you run the same risk that you’d see if you put all of your money into a single stock. The stock might shoot up, and you can sell it at the right moment, making a bundle. It could also crash, and you’ll have to hold onto it, hoping that it will go up again eventually, or you can sell it at a loss.
Regulation Will Come
You should also know that crypto regulation isn’t far away. Not long ago, President Biden signed an executive action to regulate crypto. What’s unclear is precisely what that action will entail and when the oversight will begin.
Crypto remains hard to regulate. Putting legislation in place and enforcing it don’t amount to the same thing. Still, you should know that crypto won’t remain unregulated forever, and the new rules, once they’re in place, should change the crypto landscape.