HOT !!! Bitcoin trading: Addictive ‘hobby’ that could break my bank

HOT !!! Bitcoin trading: Addictive 'hobby' that could break my bank I was always interested in Bitcoin, not that I really understand the technology, but first impressions were appealing: a decentralized currency, mined by solving mathematical equations and potentially accessible to anyone My interest was piqued, but back then, any online discussions about Bitcoin were about the mining rigs

Apparently, it took special graphics cards to be able to mine the stuff, and since I wasn’t particularly into hardware (and oh, I also had no money), I left it in the back of my mind It never occurred to me that I could just buy some Bitcoin or trade it Fast forward to 2017 Discussions on cryptocurrencies had entered the public consciousness, Bitcoin prices were sky high – thereby crashing any interest I had in getting some – and alternative cryptocurrencies like Ethereum were also becoming common knowledge A few friends introduced me to a local site on cryptocurrency trading – the most suitable term for the entire affair, actually – bitcoin

coid One friend bragged about owning zero-point-something BTC (the ticker symbol for bitcoin), which was at the time equivalent to tens of millions of rupiah Another thing that hadnt occurred to me was that I could by a portion of BTC, and that I could buy other types of cryptocurrencies at the Bitcoin Taking the leap, I took some money out of my measly savings and bought myself some Bitcoin

The date was Oct 12, 2017, when one BTC cost around Rp 64 million (US$4,480) In three days, I had made 6 percent Then, as with all markets, the price dropped I moved the BTC into other cryptocurrencies

Some rose, some fell, and because of inexperience and not taking the time to study market forces, I lost 70 percent of my money by mid-November It didn’t help that I didn’t take time to research each of the cryptos, and even if I had, there was hardly any basic information around like there were on trading stocks or foreign currency (as if I would have understood it anyway) A discussion with a banker friend led to even more questions, as she questioned the entire cryptocurrency trading industry In the meantime, by mid-November the price of one BTC had reached Rp 90 million Something was definitely happening

Then I joined a chat group Some friends and industry acquaintances had created a chat group for discussing potential gains and losses from this or that “coin” (the shorthand for cryptocurrencies), and observing how news on Stellar Lumens or Ripple announcing partnerships with banks or other established companies drove up the price Finally, by December I had recouped my losses, topped up my investment, made returns on that as well, and finally, finally started making money on crypto trading I am now comfortable enough to diversify part of my savings into crypto, as the long-term gains — at least so far — are way better than putting money in the bank Anything that can give me 1 percent gain per month is definitely better than a bank account, and I’ve made more than that

That said, I’ve noticed that the whole cryptocurrency trading trend is like placing bets on a never-ending horse race, where new horses are introduced to the race almost daily And don’t get me started on initial coin offerings (ICOs), which, in principle, are similar to a company raising funds from a stock offering, but are instead done through selling “coins” that have certain functions in return for BTC or ETH (Ethereum) Currently hot on the horizon is Tokenomycom, which launched an ICO to build an easy-to-use ICO platform Interested parties had to make a minimum 0

5 BTC investment, and as I write this article, one BTC is Rp 245 million Cryptocurrencies are definitely something to watch The underlying technology, the blockchain, definitely has some interesting potential applications, and the cryptocurrency concept will at some point find mass adoption, as it serves to disrupt (or improve) the banking industry Governments fear it, some through ignorance, some due to a fear of “loss of sovereignty” Who really understands it? Not many, I dare say, not even me

But as long as there is a trade to be made, the crypto rush will continue, and for once, I have a hobby that actually makes money – or loses money It depends on the day (kes) Bitcoin listed among top investor threats in 2018 SALT LAKE CITY — A popular virtual currency has been targeted as the greatest potential threat to investors in the New Year

The Utah Division of Securities is warning investors that cryptocurrencies such as Bitcoin are risky investments that have been used as vehicles for fraud The division Friday released information to warn consumers about schemes that may target individuals retirement savings in the near future Cryptocurrencies are a medium of exchange created and stored electronically using blockchain technology, a distributed public database that keeps a permanent record of digital transactions, a news release stated Common cryptocurrencies include Bitcoin, Ethereum and Litecoin But unlike traditional currency, these alternatives have no physical form and typically are not backed by tangible assets, said Keith Woodwell, director of the Utah Division of Securities

Consumers should be aware that these investments are not insured or controlled by a central bank or other governmental authority, cannot always be exchanged for other commodities and are subject to little or no regulation, he noted With Utah’s growing economy and consumer spending, the Beehive State could be targeted for cryptocurrency pitches, he said “Utah’s reputation as a technically savvy and connected state makes our population ripe for cryptocurrency fraud,” he said “While it’s a compliment to our population for being plugged into what’s trending, internet hype can lead to rash decisions”

He noted that because Bitcoin has seen a sharp increase in value over the past year, going from approximately $900 to nearly $17,000 currently, investors may be ripe for fraud as they try to get into the cryptocurrency market Things that tend to go up very fast also tend to come down very fast, Woodwell said We see a lot of fraudsters capitalizing on this fad that so many people are paying attention to (Scammers) are using that greed and the little bit of knowledge that people have to offer bogus investments He said fraudsters are devising Ponzi schemes using cryptocurrencies, leaving some victims in a financial lurch Theyre using money from new investors to line their own pockets and pay off any old investors to create the illusion that theres a successful business investment happening, but there is nothing behind it but smoke and mirrors, Woodwell said Some scams also involved multi-level marketing, he added, which can also lead to financial loss for unsuspecting consumers He advised investors to be vigilant in researching investments involving virtual currencies to avoid becoming fraud victims If you want to become an investor, avoid third-party traders and do so directly through a large, reputable exchange, he said

If it goes up, great! If it goes down, you rode the roller coaster and took your chance, he said If you want to do it, go through one of the recognized exchanges (and) just be aware that it can be really volatile Meanwhile, Jason Ware of Albion Financial said consumers should know cryptocurrencies are not investments “Buying cryptocurrencies is purely speculation,” he said

Ware said one of the major problems with cryptocurrencies is that they can be stolen by hackers, leaving investors empty-handed The market for cryptocurrencies is also unstable, he added “We’ve looked at the volatility of Bitcoin relative to commodities, and what we’ve seen in cryptocurrencies is unlike anything we’ve ever seen in any other asset,” Ware said Despite some apprehension, Ware sees a future for the science behind cryptocurrencies “I think the technology, the potential applications in private business and even government potentially is very disruptive and has a lot of potential to impact a lot of different markets in a positive way,” he said

The technology is known as blockchain — a peer-to-peer online system that verifies online transactions When a transaction is made, the information is put into a block that contains multiple transactions made around the same time The block is then confirmed by a computer known as a miner Once the block is verified as legitimate, a reward (ie

– Bitcoin) is given to the computer that solved it The block is added to a chain of other blocks, creating an incorruptible ledger that can be seen by anyone International money transfers would be faster as well, Ware said, where now overseas transactions can take over a week to complete “Ripple blockchain can do that in seconds,” he said “There’s a good chance that in 10 years the need to have insurance and have middlemen in between a lot of these transactions is unnecessary if blockchain is widely adopted

” As far as investing in cryptocurrencies, Ware’s advice is the same as with any investment “Buyer beware,” he said Risks of investing in cryptocurrency Loss or theft — Cryptocurrencies are stored electronically in a virtual wallet and traded through unregulated exchanges

There have been multiple cases of individual wallets or entire exchanges being hacked, resulting in thousands of consumers losing millions of dollars with no recourse or method of recovery Price volatility — The value of Bitcoin and other cryptocurrencies can fluctuate wildly After reaching an all-time high of almost $20,000 in mid-December, the price of Bitcoin fell by more than 25 percent in just 10 days Bitcoin and initial coin offerings are being used by fraudsters — The Utah Division of Securities is currently investigating fraud linked to cryptocurrencies Investors should be extremely wary of promoters who promise high returns through Bitcoin arbitrage, trading strategies or through an initial coin offering where investors receive new cryptocurrencies in exchange for their investment

No government regulation — While some companies and individuals accept Bitcoin as a form of payment, many do not Cryptocurrencies cannot be deposited in a bank and have no form of protection comparable to deposit insurance Red flags of cryptocurrency Fraud “Guaranteed” investment returns — There is no such thing as guaranteed investment returns and there is no guarantee that any cryptocurrency will increase in value Be wary of anyone who promises a high rate of return with little or no risk

Unsolicited offers — An unsolicited sales pitch may be part of a fraudulent investment scheme Be wary of unrequested communication about an investment opportunity Sounds too good to be true — If the investment sounds too good to be true, it probably is Beware of exaggerated claims about an investment’s future success Pressure to buy immediately — Take time to research an investment opportunity before handing over your money

Beware of pressure to act fast or “get in on the ground floor” of a new tech trend Source: Utah Department of Commerce

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