The enormous returns that can be achieved by investing in cryptocurrencies ensure that many people start dreaming. They also see that the money in their savings account for many years actually no longer yields so they look for alternatives. Increasingly, people also indicate that they invest a part of their savings in cryptocurrencies. This is not so much about earning money in the short term, but even, for example, to secure a piece of pension. Can cryptocurrencies be regarded as an alternative to a traditional savings account or not ? We are happy to give you an answer to this frequently asked question on this page.
Invest in cryptocurrencies for the long term
At first it must be said that many people still make the mistake of stating that all cryptocurrencies are equal. That is not true. There are several cryptocurrencies that already have fairly deep roots, which makes them a very solid form of long-term investment (at the time of writing). This not only concerns Bitcoin, but also Litecoin and Ethereum . Just as these cryptocurrencies have experienced very strong growth over the years, it has to be said that there is also a lot of potential in the crypto market for the coming years. What, for example, will the emerging talent Verge mean and what with Ripple which has already received the trust of many banks? Such cryptocurrencies are already well-founded and have such a qualitative team behind that the potential for the coming years is present.
Benefits of saving money with cryptocurrencies
Let us first look at the benefits associated with saving money with cryptocurrencies. The most important reason why a lot of people now look in this direction is of course reflected in the much more substantial return that can be achieved with cryptocurrencies compared to a regular savings account. Where you have to put it in a savings account with (at the time of writing) an interest rate that is lower than one per cent per year applies to cryptocurrencies that in the long term you can realize just a few hundred to even thousands of percent return. We have already put all the benefits that you can count on when saving money with cryptocurrencies:
- You can count on a potentially very significant return and not only on a long, but even a relatively short term.
- Saving money through cryptocurrencies is much more fun than just having to park in a savings account. This applies in particular because the preliminary investigation which must be carried out can provide you with a lot of new knowledge and insights.
- Investing money in cryptocurrencies is not as complex as it seems. There are even providers that make it possible to simply make a deposit with iDeal.
The above advantages are just the tip of the iceberg, but already make it clear why it can be interesting to save a little money by investing in cryptocurrencies. Does this mean that you immediately have to invest all your hard-earned savings in cryptos? Certainly not. There are also some potential disadvantages associated with this.
Be aware of the possible disadvantages associated with it!
One of the main benefits of saving money through a savings account is undoubtedly to be found in the fact that there is a safety net for when it goes wrong. The so-called deposit guarantee scheme ensures that all savings that can be found on a regulated savings account are guaranteed (up to a certain amount). This does not apply to money that you are going to save or invest with cryptocurrencies.
Is it wrong and does the exchange rate of the currency in which you invested completely collapse? In that case it can happen that you lose your money once and for all. At best, the course can of course still recover, but even then the invested capital is often not available for a very considerable period of time. Partly because of this reason, cryptocurrencies will never be able to offer a hundred percent alternative to classic savings through a regular savings account.
Conclusion; cryptos a good alternative to a savings account?
No party should ever advise people to invest their full assets in cryptocurrencies. However, this applies in the basis for every type of investment that you do. A company that has a very volatile character can also perfectly award shares that are characterized by a highly variable and often explosive price trend. This does not mean that the shares in question are bad, but that there are risks involved. The same also applies to an investment in cryptocurrencies. This is apparent, among other things, from the considerable price fluctuations that are, for example, so characteristic of Bitcoin.
It is clear that the crypto market has a very considerable potential. This is especially the case when you dare to look at fixed values such as Bitcoin , Litecoin and Ethereum. However, it is important that you are always aware of the potential risks involved in investing in cryptocurrencies. A bit of your capital for long-term investing in cryptos can therefore be quite interesting, but also opt for a bit of security. A significant part of your capital in a savings account is therefore still advisable in times of cryptocurrencies.
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