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Before jumping into the Bitcoin and other Cryptocurrencies bandwagon, take this advice

by Felix Omondi
bitcoin and cryptocurrency cryptocurrencies

Our editor just published a post on the >> Best Crypto Startups of 2018 << and I just remembered just how often I hear of people thinking about jumping into the Bitcoin and other Cryptocurrencies bandwagon. I hear this from my friends, workmates, schoolmates, and even talk shows on TV.

To some, it seems like the silver bullets they will use to slay down this beast of financial constraints and working on a budget. We all want to live big and never having to worry about money, but I am not sure everyone who is thinking of going the crypto-way understand what they could be into.

So I ran down a small research online and came across some cautious advice for anyone thinking of jumping into the Bitcoin and other Cryptocurrencies bandwagon. At IT Web Africa, I found a publication about a word of advice from Richard de Sousa, who cautions Africa’s potential investors to be sure they understand the technology on which cryptocurrency runs.

De Sousa is a partner at the South African exchange, AltcoinTrader, and he cautions:

The key thing here is personal responsibility and countability, personal responsibility becoming the new counterculture. The cryptocurrency space is not for people who are reliant on governments, or those expecting to be protected by government and consumer protection plans. It is more for free thinkers, people that understand the technology.”

De Sousa further believes that government authorities are doing the right thing by cautioning the general public, who are the potential investors, about the cryptocurrency industry. De Sousa says,

We encourage the authorities to give the warnings as they need to because the masses that blindly expect to be protected by government need to get warnings.”

The many Crypto Scams that hit Africa

Not to burst your bubbles – the would-be crypto investors – but there are already numbers of people who have lost millions of dollars in Africa thanks to crypto fraudsters. Take, for instance in South Africa, there was the Ponzi scheme that happened earlier this year where about 30,000 investors were cleaned dry of their investment.

Right now, the South African law enforcement authorities are on a hunt for the scheme’s elusive yet rumored mastermind. However, given the essence of cryptocurrency is encryptions and anonymity, the search could take a while if at all they get to catch the mastermind.

Another example is in Nigeria, where there have been numerous cases of dodgy cryptocurrency company duping investors out of their hard-earned cash.

Research and take the initiative to protect yourself

The key to an unbeaten run as an investor in the cryptocurrency industry is to research far and wide in order to protect yourself from scams. Rafiq Phillips, the founder of jfGi, a blockchain-based startup echoes these sentiments. Phillips says:

There is more fear, uncertainty, and doubt about Cryptocurrencies in the market than anything else. Doing your own research is vital. I believe the financial regulators’ warnings are both positive and negative, there are many illegal businesses and scams posing as Cryptocurrencies, and the paradigm shift in economies and finance [that] Bitcoin and Crypto bring forth disrupts that control financial regulators have had on the system. The positive is that doing your own research into Bitcoin and Crypto will improve your own financial know-how into only Cryptocurrencies but finance in general.”

Cryptocurrency is by no means a new concept. Bitcoin for one has been around for over a decade now. It is only now that the general public is starting to get interested in it; 2017 was the biggest year for Bitcoin, as it has never gotten more traction than last year’s.

However, the key to a good run in the crypto industry is to do your due diligence, which can only come from thorough research as you have no one to protect you in this decentralized world.

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