To a certain extent, the line separating trading from gambling is a little thin, lots of persons don’t know if trading cryptocurrencies CC is legit. When people invest about 300 dollars monthly into financial index funds that yield profitable returns monthly, that’s not gambling but investing. But, when someone puts the same three hundred dollars into a spinning wheel hoping to win back a thousand dollars in a few seconds is gambling. Speaking in terms of risks to reward ratio, trading cryptocurrencies, and gambling in casinos are two similar events that people can have mixed up. Looking at expected returns, the risk factors of an outcome can be assessed with clarity, the risk factors of trading are quite dissimilar from that of gambling. In investing/ trading CC, there is a high risk involved in their events as compared to gambling events in casinos, except in special games.
Cryptocurrency came to existence only in the last 2 decades, and from that time, Bitcoin which is its leading assets rose to a dollar 12 years ago. From that period to now, Bitcoin has risen to over four thousand dollars in the last decade, such massive growth. For an investor that involves trading the market and making profits on a daily or weekly basis, he must have made some significant returns over this time. If the crypto market were to hold its position in the financial industry for another year, its annual percentage growth would be more than 200%. People trading this market would have their capital increased by over 200 percent, now this is not gambling but stated from analysis carried out. For lower-risk profiting events like gambling games in casinos, getting this kind of return is not possible, the time frame is also different.
When you’re putting your money on a wide calculated guess, hoping to get profits from it, that’s gambling, that’s not trading, trading CC is not gambling. But when a financial enterprise is being enacted, a chance to see whether it will prosper is taken, this is synonymous with investing in blockchain. There’s a digitally secured payment system involved in CC that’s not found with gambling systems, trading cryptocurrencies don’t invoke third parties. Warren Buffet along with some other investment gurus has at one point declared trading cryptocurrency a gambling game. Though they are not respected people, the crypto market is not designed to set up odds in your favor or against you, this means is not a game of gamble. Its infancy nature has made it a market full of speculations and greater risk assessments as compared to other aged financial institutions like real estate.
There was a huge increase in CC valuations 3 years ago, misleading lots of amateur traders/ investors into believing the system is risks free. This asset class, like others, has its peculiar and general risks associated with it, one of which is the ‘regulatory risks’ being its biggest. Regulatory risks are propelled from the bodies of international platforms assessing certain protocols to ensure legal trading society. As the cryptocurrency market’s assets are rising in values, trading pros are being pulled in, regulators are pulled into the platform too. Volatility trading risks are encountered by those who trade in short time frames as the cryptocurrency assets are highly volatile having rapid price movements. All these have proven that trading cryptocurrency is not a gambling endeavor.