There are several reasons behind the popularity of bitcoins all over the world. People are taking more interest in Bitcoins than Stock Markets. Recently the growth in the value of Bitcoins shows that it can grow more rapidly than Stock Markets. For several years people are investing in stock markets and they have to wait for long time to get better return, while bitcoins can return huge profit in short period.
Regardless of volatile nature of bitcoins, people are showing more interest in bitcoins or digital coins.
Some comparisons are given below found by Unocoin in their study, so that people can understand which investment is better for them.
1. Make profit in short period
History shows that stock markets need a few years to return a good profit to their investors. Investors need to have some patience if they want to earn some profit by investing in stock markets. People can also invest in stock markets for short period, but they may have to bear loss on their investment. Sometimes they also earn profit in short time investment in stock market.
On the contrary, bitcoins can give huge returns in short time just because of its volatile nature. Recent bitcoins trading history proves it. That’s why people are investing more money in bitcoins than stock markets. Some experts also have predicted that the value of bitcoins might reach $10,000. Currently it is trading at $7700.
2. Bitcoin is known as global currency
Bitcoins are currently being traded in 180 countries in the world. People can easily transfer it from one address to another by paying extremely low fees; while traditional investments like stock markets require high trading fees with formal accreditation. Not all buyers can invest in stock markets.
I don’t how much time stock markets take to convert stocks into fiat money, but I know bitcoins can be converted into fiat currency within some hours. This is a decentralized currency and no one can control the bitcoin transaction. It is completely anonymous. These qualities of bitcoins draw the attention of investors.
3. Bitcoin supply is limited
Everyone knows that only 21 million bitcoins can be minted to maintain demand and supply. Currently the growth in bitcoin price shows that the most of the people worldwide are using bitcoins in every sector. This limit supply feature will always maintain demand and supply. It is said that demand should always be more than supply.
However stock market doesn’t have this type of restriction. So demand and supply can be predicted in this area as per Unocoin research.
4. How risk factor differs bitcoins from stock markets
Yes, investment in bitcoin is subject to risk factor as it is so volatile and its value highly fluctuates depending on demand and supply. Share market has also the same risk factor but it falls under government terms and regulation, which separates it from bitcoins.
Bitcoin is a decentralized currency and not controlled by anyone or government and so it is considered as more risky than stock markets. But there are also many people in this world who like anonymity which actually increased the price of bitcoin.
5. Bitcoin trading is easier than stock trading
If one wants to invest or trade in stock market, he needs to consult a registered broker who help him trade in stock market. Apart from this, some of his investment amount will be spent in paying brokerage charges, trading charges and tax, etc. Before making an investment, he needs to open a demat account, otherwise he can’t be able to trade.
In case of bitcoin, one doesn’t have to pay the same numbers of charges. Bitcoin transaction requires a nominal amount as fee which is very lower than stock market’s fee. But once you have made the transaction, it can’t be reversed. So you need to mention correct bitcoin wallet address, otherwise you may lose your bitcoins. In order to invest in bitcoin, you only need to open a bitcoin wallet and nothing else.
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