Cryptocurrencies Market Investing Worries

Cryptocurrencies are often mentioned as the modern Gold, especially by the millennial generation, that often believes that digital currencies are the most trustworthy monies one can hold

Cryptocurrencies are often mentioned as the modern Gold, especially by the millennial generation, that often believes that digital currencies are the most trustworthy monies one can hold and also the most effective means to evade government control. 

Cryptos can have many advantages as a payment system; however, there are consequently many disadvantages which make them inappropriate as wealth preservation.

The following are cryptocurrencies worries:

  1. The cryptocurrencies are an electronic entry on many computer systems. In and of itself, is a receptacle to be hacked or lost. Over one billion dollars was seized and stolen in 2018. Last year alone, 4 billion dollars worth has been taken illegally.

  2. Once the private crypto key is lost, it's gone forever. You will not recapture it or get it back, and there is no insurance to cover it. Many exchanges provide insurance policies, although it is unclear at this time if any are serviceable.

  3. It is true; you can take your cryptos into an offline state (cold storage); however, each time you put them back online mode to make transactions, you're once again exposed to menace.

  4. Cryptos are very often compared to precious metal - Gold; however, we must be reminded the fact that as of this writing, the total market capitalization of all cryptos combined is over $215 billion. The total market value of Gold in the world is $8.5 trillion (That's with the "T").

  5. Unlikely, the central bank's cartel will ever allow cryptocurrencies to be a dominant money choice vs. their fiat money. Cryptos can be outlawed and banned by closing down exchanges worldwide and prohibiting all trading - China had reportedly closed all crypto exchanges in 2019

  6. Granted, if it's outlawed, peer to peer trading on a black market would likely be possible even though it is illegal. Convertibility to fiat money would be made a criminal offense, and all unlawful transactions would be voided and pronounced null. Hence if you have purchased an automobile with cryptocurrency, it would be seized and confiscated.

  7. Ultimately, governments and central banks are inclined to ban all private tokens and spring their own to replace current fiat/digitally created electronic money. This will be an excellent way for them to control and to tax every electronic transaction instantly and to turn off the monetary system or people's private accounts at will. This is not over the top development in the Police State contemporary era. 

  8. One of the gravest menaces to cryptocurrencies is mega-cap information technology firms’ with the capability to decode at will. Most tokens, such as Bitcoin, employ a 256-bit encryption scheme. Yet, currently, there is a firm that can break 128-bit encryption code - Google can crack 53-bit. The company proclaimed that it expects to break a 256-bit encryption code in the next couple of years. 

  9. Any method of encryption might become worthless within the next several years; thus the encryption method will likely mature to be far more advanced, so as Google’s quantum processor's capacity to decipher those advanced methods, as the technology giant going to be even more dominant by controlling virtually all systems as well as governments.

  10. With the latest Quantum computing, a processors task that would have demanded 10,000 years on a current supercomputer currently takes as little as 200 seconds. 

  11. Although the jury is out on how the central banks decide to move things forward, we regard the above issues as a launching pad to a future where all central banks distribute their cryptocurrencies at some point - pretty a frightful development yet undoubtedly possible.

In conclusion

We have made it clear from other writings on the subject that from a wealth preservation viewpoint, not cryptocurrencies nor Gold ETFs will perform as a real safeguard as we are facing the intractable difficulties that the world will face in the coming years.

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