The recent rapid growth of bitcoin has caused a new wave of interest in bitcoin as number one.
People hear about the fantastic results that bring investments in bitcoin, and it inspires them to bold and often risky behavior in relation to their own money.
Fixed a few cases where people have mortgaged their homes to get funds to invest in bitcoin.
Unfortunately, newcomers often forget the first rule of investing in cryptocurrencies: “do Not invest in bitcoin more than you can afford to lose”.
A disturbing trend
Except when people mortgaged their home to invest in bitcoin there are also cases, when people took loans to buy a potentially explosive and volatile assets.
Joseph Borg, President of the North American Association of securities administrators, the volunteer organization that works to protect investors and the Director of the securities Commission of Alabama see a worrying trend among investors in cryptocurrencies.
There are instances when people put their houses to buy bitcoin… People use the loan funds for investment. For a person who earns $ 100,000 a year who have a mortgage and two kids in College – this cannot be considered an optimal investment strategy.
The point of view of Mr. Borg, the main thesis of which is that if most of your income to “eat” current expenses, investing in bitcoin do not need is more one-sided. But the one statement hard to disagree – to invest only the money that is “free” and not tied to any operating expenses.
Two sides of the coin
The problem is that there are many stories about how investments in bitcoin helped people to deal with years of debt. However, it is pointless to take on debt, to try to get out of other debt, especially with such a volatile asset like bitcoin.
Investing in bitcoin itself, though risky ,is not a problem. The use of credit cards, mortgages or any other credit funds is a real problem and that is something that should be avoided.