Should you invest in cryptocurrencies in 2022?

The last few years have been exciting, to say the least, for cryptocurrency investors. After experiencing unprecedented public interest, the digital currencies had a phenomenal 2021 – only to take a nosedive early in the summer of this year. Now, as the surviving currencies have started to recover from the crash, the future of crypto seems to be way more uncertain than it ever was before. So, if you have yet to venture into the market, should you take the leap and invest in a currency at this point? The answer to this question depends on many different factors and what you’re comfortable with. Below, we’ll take you through the pros and cons of investing in crypto in 2022 and what you should take into consideration.

Pro: More and more businesses are using crypto

With the many different currencies out there, it’s very difficult to say whether investing in crypto as a whole is a good idea. In truth, making a successful investment is more about choosing the right currency – one that has proven itself relatively stable and has as many different uses. For instance, according to https://cryptomeister.com/, Ethereum investors can now use their ETH to pay for gas fees and other items on the Ethereum blockchain. Other currencies can be used to pay for NFTs (non-fungible tokens) – which in themselves are also being used more in people’s everyday lives, e.g. with Samsung signing deals with retailers to offer offline shopping rewards with their NFTs. So, by choosing a currency with uses you’re genuinely interested in, you make your investment even more worthwhile.

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Con: Crypto is a volatile investment

With that being said, it should be common knowledge by now that any type of investment is a risk. And especially with crypto, this is still very fresh in the minds of many. As we’ve already mentioned, an unfortunate chain of events caused the entire cryptocurrency market to crash, beginning in May earlier this year. This especially affected the stablecoin Terra, causing it to depeg from the dollar – which then also made the value of the cryptocurrency Luna drop and crash. This, of course, didn’t “just” have devastating consequences for investors: It also caused panic to spread throughout the rest of the crypto world, leading to bankruptcies and losses for many other currencies. So, as they recover and rebuild, it’s important to keep this volatility in mind – only investing what you can afford to lose, watching market developments closely and not making any rash decisions.

Pro: Regulations are on their way

If there’s one positive takeaway from the crypto crash, it’s that it’s put lawmakers to work. Pretty much all over the world, people in charge are discussing regulations to prevent crashes of this magnitude from happening again. For instance, the US president recently put out a framework for what the country’s upcoming crypto regulations should look like – and many other nations are in the middle of similar processes. While this might sound like bad news to crypto enthusiasts, it really shouldn’t. If done right, regulating crypto can make trading in it much safer for everyone involved – which also means that you’ll feel much more comfortable investing. One thing’s for sure: How lawmakers everywhere decide to tackle cryptocurrency regulations will be exciting to follow.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes.