Technology is revolutionizing the way we do business and cryptocurrencies have become a key factor, opening a world of opportunities for individuals and companies willing to explore the digital universe. That’s why we invited Paola Vargas, MSc in Financial Management to talk about the subject.
In the first place, it is important to be clear that the main purpose of cryptocurrencies is to provide a decentralized form of digital money. Intended as alternative to the traditional financial system, in which banks and governments exercise centralized control over monetary transactions. They are a technological tool to be used as a means of payment and exchange, through instant transactions 24/7 without border limits. Others see it as an option to address the macroeconomic challenges we currently face.
Initial steps before investing in cryptocurrencies
When considering investing in digital assets, it is important to apply the same criteria that would be used for any other investment. Warren Buffet, a well-known investor, advises against investing in something that is not understood. Below are some general criteria to keep in mind before investing in cryptocurrencies.
Inform yourself and get advice: It is essential to seek the guidance of experts and qualified professionals in the field of cryptocurrencies. This will help create a proper investment profile.
Assess time horizons: It is essential to determine the term in which you want to maintain the investment. With the right advice, you can decide whether the investment will be short or long-term depending on the investor´s profile.
Measure the level of risk: It is important to understand the level of risk to which you are willing to expose. Are you looking for higher returns by taking higher risks or do you prefer safer and more stable investments?
Diversify investments: Following the advice of “not putting all your eggs in one basket”, it is advisable to diversify investments. This will help mitigate potential negative scenarios that could affect investment performance.
Once these four aspects have been analyzed, investment can be advanced. Otherwise, if a scam or an unreliable project is detected, it is preferable not to invest and look for safer and more reliable alternatives.
What factors should businesses consider when selecting a reliable cryptocurrency exchange?
It is essential to have clarity about the platform you will use for the exchange of digital currencies to the currency of legal circulation in your country. Some considerations to keep in mind are:
- Reliability of the market on the platform: you must validate the reputation, opinions found on the internet, who is behind this platform to ensure its content. Many have agreements with banks or entities to monetize which gives more peace of mind.
- Security: with the evolution of web 3, you should be more cautious in security issues, because when money is involved the risk of being hacked is greater. This is where you should assess what measures are taken by the platform or wallet for cyber security, authenticators, security safeguards, also know your stakeholders.
- Functionality: It is important that the platform interface is intuitive. Initial transactions such as receiving and sending crypto should be easy and guided so as not to give rise to errors and also achieve monetization easily. If you are a more experienced person who wants to trade or trade for investments, a more robust ecosystem is required giving various forms of trading.
Advantages for companies of implementing cryptocurrencies as a payment method
- In terms of management and operability, cryptocurrencies enable more efficient transactions and payments by reducing shipping fee costs and eliminating intermediaries that could lead to delays.
- Real-time verification of transactions allows you to validate the authenticity of transactions, without having to wait for bank reports. In addition, both companies and customers have full control over information.
- Thanks to advanced cryptographic technology and the use of Blockchain technology, transactions are kept secure and sensitive personal and financial information is kept encrypted, providing protection against fraud and data manipulation.
- Adopting cryptocurrency payment systems or investing in cryptocurrencies can provide currency hedging on remittance payments and protect against negative inflationary effects or other macroeconomic risks.
What are the advantages of the Simple Pay wallet?
Simple Pay wallet is an excellent option for those people who are unaware of the crypto ecosystem, because Simple Pay offers a very easy and intuitive interface to understand where users can buy, exchange, use and store their cryptocurrency safely. If you want to venture into the crypto world. Visit SimplePayGlobal.com, a trusted source where you can learn more about this exciting technology.
Paola Alexandra Urrutia
Community Manager South America
