Nowadays, one of the most frequent questions financial adviser gets is about the timing in bitcoin investments. Coindesk revealed that the value of bitcoin is four times this year and they released coin offerings which were able to gather over $2 billion in interest. It is no wonder that financial adviser websites are loaded with questions about the digital currency which earned more interests from investors. In a recent trading, bitcoins digital currency exchange is set at over $4,880.40. When 2016 ended, the value was only at $986.
Despite these booming numbers, financial investors do not think digital currencies are a good investment along with other investment vehicles that have been trending lately. When trading digital currencies, there are accompanying risks in market and its regulation policy. Financial advisers said that they may be a good investment in the future when they have been fully established but as of the moment it is still considered a bet to invest in these digital currencies.
Julie Ford, a financial adviser based in New York, said that the potential result can be tempting but it is not recommended if you are investing to achieve a long-term goal such as buying a house or saving for retirement since the risk is quite high.
Ford told about a client willing to invest a big part of her retirement savings to bitcoin but she said that a risk that high is not something she will recommend. For an individual planning to do so, Ford advised that they must have no debt, have significant emergency funds, on track with their goals financially and must have a positive cash flow.
Bitcoins have gone through ups and downs with great fluctuations making it a hard choice as a currency. Financial advisers have also pointed out that there is a risk that the government might put restrictions on the use of bitcoin or they could control it altogether.
There are also risks in tracking bitcoins especially if you are not monitoring closely or through illiquidity. Interested investors in bitcoins should look for financial adviser websites and hire one to help them decide about their planned investment to avoid being financially unstable.