Cryptocurrencies have become a very popular topic of conversation in the last few years. During that time, these digital curries – such as Bitcoin, the most well-known among them – have enjoyed a meteoric rise to popularity as an investment. Unfortunately, they have also seen their share of lumps along the way and are only continuing to struggle.
Many financial experts now advise against investing in these cryptocurrencies. Celebrity financial wizards like Warren Buffet have been quoted as saying that currencies such as Bitcoin will “come to a bad end”, ultimately. However, millions of people continue to cash out their savings or even take pay advances to invest in these currencies, hoping fate will change in their favor.
Are you among these investors? Are you sitting on a large investment that was made in the hopes of a favorable turnaround? Have you already witnessed hundreds, thousands, or even more of your hard-earned money spiraled away by this sweeping investment trend? Here’s what to do if you’re still investing in currencies such as Bitcoin – and how to recover if you’ve already felt the sting of this financial mistake.
Most investment advisors will tell you that putting your money into anything that isn’t stable and reliable in nature is a huge gamble. This is the reason that many long-time investors refuse to even get near Bitcoin and other cryptocurrencies these days; it’s just too volatile. The currency has been well-documented now as fluctuating wildly in value, which makes it a risky and even inadvisable investment choice for most.
Those who do choose to invest in something like Bitcoin need to understand that they are at a high risk of losing their entire investment. This is why putting money into something so unstable should be kept to a minimum, perhaps as part of a large and diversified portfolio. Unfortunately, this was not the kind of choice most investors made at the height of Bitcoin’s popularity, with many diving in with their entire portfolio pouring into digital currencies.
This is probably because those who got in on the ground level of the cryptocurrency trend with things like Bitcoin touted them as a way to increase wealth quickly and dramatically. People are always on the hunt for things that will increase their wealth and make them a lot of money in a short amount of time – preferably with minimal effort. There are smart investments that can do exactly that but finding them can be difficult. Perhaps this is why so many people were convinced to invest in Bitcoin without it having an extensive market presence to consider.
Beyond the shakiness of the market value of cryptocurrencies like Bitcoin, there are other major risks to consider before investing. Bitcoin and things like it are easier to lose than other forms of currency. They can simply disappear from existence – or from your digital wallet. They may be stolen by other users – hackers, essentially or they may simply disappear due to technical issues. Unfortunately, once your cryptocurrency is gone, there isn’t much you can do to get it back.
There are also major security issues, including numerous issues of fraud. Because the exchange of regular currencies for cryptocurrencies like Bitcoin are not well-regulated, there are numerous fraudulent exchanges present online. These forums lure unsuspecting would-be investors in by promising Bitcoin in exchange for their dollars or other currencies, only to take their money and virtually run.
Unfortunately, current and former Bitcoin investors have largely already lost money on their ventures. Many investors who dove into the opportunity while the currency was soaring ever-higher have now lost hundreds of thousands of dollars or more. Many of these investors took money from their retirement, their life savings, or other important accounts to make these investments, and now feel as if they have been blind-sided – or even robbed.
If you feel that you’re stuck with unusable currency in the form of Bitcoin, fear not; many retailers, service providers, and even charities now accept payment in the form of Bitcoin and similar cryptocurrency. While this may not be the best news if you’re hoping to recoup your initial investment, it does calm many people’s fears of hanging onto useless digital money.
Some examples of companies that will take those Bitcoins off your hands in exchange for something you might actually want or need include:
Some colleges and universities now accept payment for courses and credits via Bitcoin and other cryptocurrencies. There are also some investment professionals that assert that hanging onto some of your digital currency may be a good idea if you do so as part of an overall diversified portfolio. Still, if that idea doesn’t appeal to you, an increasing number of retailers and service providers are willing to take them – and give you the option of getting rid of them.
Likewise, you can also donate your Bitcoins to the United Way and several other charities and enjoy a large tax deduction for doing so. Just be sure that your donation exceeds federal minimums for tax deductibility and that you work with a lawyer or tax preparation specialist who understands the conversion rate and can help you claim the largest possible deduction. It’s a great way to make something good out of a previous mistake and enjoy a return on your investment – even if it’s not in the way you might have initially expected!
Losing money via a bad investment isn’t the end of the world, but it can certainly feel like it – especially if you lose a significant amount. If you are struggling with a major financial loss, speak to a financial advisor or legal professional. The team at Van Horn Law Group have the kind of industry experience to help you navigate life after a difficult investment – and help you get things back on track.
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