Cryptocurrency has been emerging as the next coin that investors had better concentrate on. Which differentiates cryptocurrency from common stocks?
Shares and bonds are the main sectors that investors desire to make a great profit. However, along with the development of blockchain, cryptocurrency has begun to attract investors’ attention. It is undeniable that Bitcoin has made numerous billionaire names in the global market since it was first in circulation. After that, a cluster of cryptocurrencies was born with many different opportunities and risks.
What will you choose to invest in? Stocks, Shares, Bonds, or Cryptocurrency? Operating on blockchain technology, cryptocurrency seems to be rather strange to many investors. In this article, we discuss the general knowledge about stocks and cryptocurrency and then analyze the potential of each type that helps you make your best choice in the investment race.
How do we buy them?
Stocks are purchased and sold in two ways on the stock exchange market. For starters, corporations list and sell their shares and bonds in the primary market for the first time. The shares and bonds are then exchanged with other investors on stock exchange platforms in the secondary market. The investing technique chosen by the investor determines the potential rewards and hazards.
Buying and selling digital currencies such as Bitcoin and Ethereum using INR, dollars, pounds, and other currencies is the basis of cryptocurrency trading. A crypto asset is initially purchased using local cash, after which crypto investors immediately begin investigating and trading in order to earn a profit.
What has an influence on the profits?
Demand and supply forces established by sellers and buyers have an impact on both the stock exchange and crypto markets. Political events, natural disasters, athletic events, and other events all affect the stock market. This is due to the banking system’s interconnectivity and government laws that oversee the stock market. However, cryptocurrency is in the global ecosystem that wipes out the risks of intermediaries and exterior elements.
Market volatility – a decisive factor
Crypto exchange is an interesting and lucrative trading alternative, but it is also risky due to the market’s infancy. As a result, cryptocurrency is exceedingly volatile and, as a result, a source of rapid and huge profits. The stock market, on the other hand, is a very stable, established, and varied trade market with relatively easy-to-trace and anticipated investment returns.
The difference between decentralized platforms with centralized ones
Due to the decentralized nature of cryptocurrencies, the central bank, authorities, or intermediaries cannot control or access their operations and transactions. This decentralization gives crypto consumers a lot of transparency and power. Profits gained by trading crypto assets, on the other hand, are subject to capital gains tax under the Income Tax Act. The stock exchange, on the other hand, is regulated centrally by the Bank and the Securities and Exchange Commission to avoid fraud and mismanagement.
Last but not least, because of its online nature and lack of strict rules, cryptocurrency trading is available 24 hours a day, seven days a week, making it more convenient and accessible. Due to rigorous timings and few extended hours of operation, access to the stock exchange market is limited.
To sum up, cryptocurrencies are assessed as fertile lands for investors. Compared to traditional types of financial investments, cryptocurrencies ensure a more flourishing future for investors with a decentralized and secure trading system. Being a smart investor, do you know what is more suitable for you? You would like a stable road or a bright but little risky road.
akaChain is backed by FPT Software, a globally leading technology, and IT services provider. It is an end-to-end, permissioned, multi-chain network based on the Hyperledger Fabric. Since its establishment in September 2018, akaChain’s product has assisted many enterprises, from SMEs to Fortune 500 firms, to transform with distributed ledger technology. The company provides a broad range of permissioned blockchain-based products and services in multiple sectors, including retail, supply chain, banking and finance, insurance, shopping mall management, etc. to transform with its distributed ledger technology. For more information, please visit https://blog.akachain.io/
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