There has been a recent influx of interest in bitcoin investing in the markets. People that had invested $10 per bitcoin back in the day are likely now worth in thousands. This may be a grandiose return but at the end of the day it is not investment it is more of a speculation. Although rewards are high, the returns can be exceptionally risky in the higher margin of volatility. Not to mention the fact that capital gains tax calculations can be tricky. And, then there is a lot of fraud associated with cryptocurrencies. The valuation can also be difficult to calculate for bitcoin in real terms. There is also that aspect of limited acceptance within a wide spectrum of markets which makes conversion into cash at times difficult. The magic percentage to bitcoin is 1%, any more and one has an exceptionally high risk to return ratio which may not often provide the right level of long term expectations on the highly volatile cryptomarkets. Undeniably, if one looks at it, paper money tends to be worthless, but digital currency in real terms is even more worthless. Any security needs to be backed by something. What is a bitcoin backed by? Some form of currency? What is the asset value of a bitcoin? There is no sensible regulation, no sense of protection. At least, not one that has been unanimously agreed across jurisdictions. It is the underground currency so to speak in the digital universe.
