Not too long ago, people started to hear about this newly digitised currency. Only the tech fanatics at the time took the risk and bought themselves some Bitcoins. Some even carelessly bought a few Bitcoins and completely forgot about it. And then the unthinkable happened. Bitcoins were with tens of thousands of US Dollars. Bitcoin has made many people millionaires and changed their lives forever. In fact, you would hear stories about lucky Bitcoin winners who quit their jobs, moved into their dream homes and bought the latest sports car.
So, what’s happening now? It is evident that Crypto Currencies, not just the giant Bitcoin, face some backlash. Many governments prevent the use of these digitised currencies to make purchases. And that’s mainly because these digitised currencies are someone challenging to regulate. What is their future? Especially since there are now multiple cryptocurrencies that are trying to compete with Bitcoin, hoping for similar success.
The Crypto market is no longer that booming trillion-dollar market. One of the most prominent crypto names, FTX, has gone on a rapid downward spiral in the last few weeks. It has even lost an acquisition deal with Binance (the trading platform for crypto) due to its collapse triggered by US agency investigations. Older cryptocurrencies like Bitcoin and Etherium have also plummeted over the last few weeks. So, the big question is, should you invest in crypto?
Smart business owners are always looking for ways to increase their income streams, and perhaps investment in currencies has always been a reliable methodology. But what about crypto, where is it headed and should you continue to invest in crypto?
It’s no secret that the crypto market is highly volatile and can greatly fluctuate. The reason behind this is that crypto is not tied to any sort of physical assets or intellectual property. Also, crypto doesn’t provide its investors with cashflow or dividends. It provides them with more or less cryptocurrency, all based on the supply and demand at the time of purchase and withdrawal. A recent article in Forbes Advisor predicted a turbulent future for the crypto market in the coming years.
Experts advise that when considering purchasing crypto, you must do so with caution. The recent price drop may be lucrative to some. However, we must remind you of a common Wall Street saying: “Never try to catch a falling knife.” That said, buying crypto means knowingly buying assets in a highly volatile market. The choice is yours; what do you think about buying cryptocurrencies?
If you have already purchased cryptocurrencies and are looking for tax support in that matter, feel free to reach out by booking a discovery call. Our team of certified accountants and tax advisors would be happy to assist.
