A CURRENT HOT TREND IN WORLDWIDE AND THE KEY OF THE FUTURE —— CRYPTOCURRENCY.

KUALA LUMPUR: The way people pay for products and services has changed as a result of technological advancements. Payment methods other than cash, such as credit cards or online transfers, are becoming increasingly popular. Meanwhile, one of the methods pushed by technology is cryptocurrency.

What is cryptocurrency?

Cryptocurrency is a digital currency that uses cryptographic principles to ensure transaction security and control the creation of transaction units. It is safe to use because it employs an online ledger with powerful cryptography to secure online transactions.

According to a market research website, there are more than 10,000 different cryptocurrencies traded publicly. Bitcoin is the most used cryptocurrency, with a global market capitalisation of $1,106,226,132,525. Bitcoin is a cryptographically secured digital currency with no central authority that was created by Satoshi Nakamoto in 2009.

With the flow of time, cryptocurrency has grown in popularity. The main reason is that it is both a profitable investment and a secure method of operation. Experts in economics see it as the currency of the future. Some individuals are rushing to get them now before they become more valuable and pricey. Other supporters like the blockchain technology that underpins cryptocurrencies, because it is a decentralised processing and recording system that is more secure than traditional payment systems.

Top 15 cryptocurrencies by market capitalisation in March 24th, 2021.

Short-selling Bitcoin.

How do people make money from buying and selling cryptocurrencies like Bitcoin? Traders do bitcoin shorting to earn money from it. Shorting Bitcoin is the action of selling the cryptocurrency and wait for the value to fall and you will be able to buy it again at a lower price. Traders profit from the price disparity in the market. Short-selling follows the typical business concept or rules of ‘buy low and sell high.’

How to short-sell Bitcoin?

Short-selling Bitcoin can be done in a few different ways. Traditional short-selling is one of the methods. It entails borrowing actual assets from a broker or a third party and then selling them on the market. If the market price drops, you'll be able to buy the Bitcoins back at a lower price, return them to their owner, and benefit from the price difference. Trading CFDs, or ‘contrast for difference,' is the second option. It allows you to speculate on whether the price of an asset will rise or fall without having to possess it. This generates rewards while also posing a risk to traders.

The third strategy is short-selling assets. Although this method may not be ideal for all traders, it is easy to grasp. Sell Bitcoin at a price you think is reasonable, then wait for the price to drop and buy it. Sell high and buy low. Of course, if the market trend does not match your expectations, you may either buy at a high price and absorb the loss, or you can lose your Bitcoin asset. Furthermore, shorting Bitcoin comes with a high cost and significant risk. For example, you must pay a custody or bitcoin wallet for storing the encrypted cash before the transaction can take place, and you must carry the risk of bitcoin price volatility. If the price climbs instead of lowering as expected, you could lose a lot of money. Moreover, some exchanges will provide leverage for transactions, which could magnify your losses.

Cryptocurrency is the future of money.

Cryptocurrency is an unregulated high-risk speculative investment. The cryptocurrency market is unpredictable. When the market undergoes unexpected changes, their prices are easily affected by these changes. At the same time, because cryptocurrency is electronic, it could be exposed to network security threats. Before investing in the Bitcoin market, please make sure you know your risk and can handle the risk.

INTRODUCTION TO JOURNALISM

Done By: YUKI CHO YUNG KEE, 2021

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