Risks of investing in cryptocurrency
Trading Cryptos involves significant risks:
Your coins can become 100% worthless if nobody wants to buy them anymore.
Your coins can be stolen. You can leave your coins in the marketplace (Exchange), but the exchange can be robbed or hacked, then the coins are gone. The break-in into an Exchange, where the users have lost a lot of money, has already happened: Google sometimes to Mt.Gox.
You can also transfer the coins into your own wallet (wallet) and save them on a USB stick or on a computer. But even these can be stolen or hacked or the computer or USB stick is broken.
You can also print the coins (keys) and put them in a safe deposit box, but basically, an attacker will need to take a photo of the key to type the string and transfer your coins to another wallet.
You can also easily lose your key (fire, where did I hide it again) and then there is no way to get back to the coins. By the way, that's one reason why probably less than the originally generated bitcoins are still usable. Bitcoins have a deflationary bias through loss and thus become more valuable in theory. I myself use a Hardware Wallet Ledger Nano S and a set of 24 random words that will allow me to get back to my keys whenever the ledger becomes defective or lost.
The state can ban cryptos or make the conditions for cryptos unattractive.
The market can be manipulated or completely detached from the real assets and bitcoins by uncovered derivatives.Cracking Keys: According to the current state of the art, it is considered impossible to crack a private crypto-key. But maybe someday somebody will invent the super-fast quantum computer with unimaginable computing power that will be able to crack your key and transfer your money to another bitcoin address.
Errors in Software: The software that you use to generate your Bitcoin addresses and keys could be flawed and make guessing keys easier.
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Bro, you are right.. Wit the fast rate at which bitcoin is growing so is the rate of hacking and online increasing.
Bitcoin and other crypto are wonderful coins that needs to be safe guarded, so it's up to us, to be careful how we trade our assets to unreliable sources. Nice article on Cryptos @emmanuelzod
Yes, cryptos are awesome! Thanks for reading.
There are so many ways where our cryptos can be stolen. The community has to figure out how to police and protect the regular folks from hacks. Otherwise no one else will cross the road into the technology. It will be beautiful when it gets figured out.
Correct! Kyc was introduced in order to checkmate some of the crypto activities going on
KYC has been optional and limit is around 2 BTCs per day. That still seems like a lot. However, it doesn't get away from the hacking issue which is a fundamental basic trust component. Literally, it's like going into a bank and literally wiping out every single penny and the cops didn't even get a chance to react before everything is all gone. At least in a real bank heist, the robbers can only take what the getaway car can hold.