The Pros and Cons of the Growing Number of Cryptocurrencies
If a 13-year-old boy can create a cryptocurrency, and a 27-year-old man can be a crypto billionaire for being a developer; there is no stopping young bright and ambitious minds from taking their chances in making and growing cryptocurrencies. Who knows? They can also make a breakthrough sooner or later.
Swing to the right
It would not hurt to listen to your better angels and stay optimistic about the growing number of cryptocurrencies. This year alone, the World Wide Web is home to over 4,000 crypto coins, according to a report. And nothing has stopped the number from growing another 500 after only several months. It only goes to show that the crypto market has transformed itself from a sea to an ocean of opportunities where you can stay afloat with some trading tips by bitcoin-trader.app.
The increased number of crypto coins could always be flipped in favour of the public. There would be more freedom for people to make their choices when it comes to seizing investment opportunities. It would also mean greater chances of reducing risks since you can always choose several digital currencies where you can put your money. But then, you will have to take your picks wisely.
Another good thing about having more players in the crypto market is the competition. As you know, competition tends to stabilise prices as a consequence of the interplay between supply and demand. It would not hurt to have various crypto coins available in the market amid the overwhelming interest of people all over the globe. Imagine over 200 million people have already created their respective crypto accounts.
Swing to the left
The more cryptocurrencies, the tougher it would be for states to protect the interest of the nationals. Remember that the crypto market is not only decentralised but also unregulated. It only relies on self-regulation, which is based on the concept of the invisible hand orchestrating the behaviour of a free market. So far, it has worked for Bitcoin, Ethereum, and many others, although the lingering question would be how further it can go.
A call for regulation was brought about by the vulnerability of cryptocurrencies and crypto exchanges to cyber attacks. You might have been bothered by the latest attack against Poly Network involving a huge amount of coins. Luckily, the loot was returned after a public appeal directed to the hackers had been made by the company. It was the only way to resolve the situation without the legal and technological show of force.
There is also a concern about the possibility of a crypto bubble following the dot-com bubble. According to a report by Forbes, the bubble might burst the moment the confidence in cryptocurrencies decimates due to its environmental impact as crypto mining activities multiply. Elon Musk himself has already raised issues on the carbon emitted by the network of computers. Whether or not there is something to pop in the future will all depend on how the crypto market would adapt to keep the stability in terms of public perception.
Stay in the middle
Feel free to stay in the middle by staying cautious in making crypto investment decisions. Despite the growing number of cryptocurrencies, it would be safe to place your bets on those that have already established decent track records. As much as banks impose the Know-Your-Customer policy, you may want to follow their lead by getting to know your choice of digital currencies.
In time, you can always branch out by taking a pick from new entrants. You can start investing small to manage the risks innate in cryptocurrencies that are still settling down. Nonetheless, you will have to do your homework by keeping yourself abreast of the latest development so that you can take the necessary action anytime.
Finally, it would be better to withhold your judgment. It would pay to keep an open mind in a highly volatile niche like the crypto market. You will have to monitor prices and go over the historical data before deciding to buy, sell, or even transfer. The trick is to be diligent before you move.
There are advantages and disadvantages brought about by the growing number of cryptocurrencies in the market. You will have to weigh these factors to be able to find the middle ground. And that is the perfect place where you can optimise your opportunities with a degree of caution.