10 Frequently Asked Cryptocurrency Questions on Quora Answered

Curious investors have a lot of cryptocurrency questions that they generally post on Quora 

Crypto has grown at an exponential rate over the past few years and it will not be incorrect to say that in the past few years, the advent and the impact of cryptocurrencies have been the most talked-about issue. People of all ages and groups are curious about the digital currency market and how it originally functions. So, naturally, there will be a lot of questions in the minds of those who are curious about investing in digital currencies. These cryptocurrency questions are sometimes about investing in them, the nature of blockchain technology and digital currencies, or which crypto is currently the most profitable. As the crypto market continues to gain traction in the various facets of government, business, and personal financial activities, more and more are investors are getting attracted to the market. Most crypto questions on Quora shortly answer the most prevalent questions in a crypto enthusiast's mind. But here, we have assorted for you a platter filled with the most frequently asked cryptocurrency questions on Quora along with their answers.

What is the best cryptocurrency to invest in?

Well, honestly, the answer to this is many. Bitcoin, Ethereum, Solana, and XRP, to name a few are some of the most popular cryptocurrencies in the modern era. But investing in cryptocurrencies solely depends on the investors' ability to handle losses and market volatility. If the investors are looking for something less volatile, then they should opt for stablecoins.

Is cryptocurrency the future of money?

With the evolution of technology, the definition of money is constantly changing. So, it should not come as a surprise that cryptocurrencies might be considered money in the future. But digital currencies still have a long way to go before being officially considered by governments to be used as cryptocurrencies. Due to its high volatility and unknown effects in the economic market, governments are still reluctant to use cryptos as legal currencies.

Are there any ways to purchase cryptos outside an exchange?

Yes, Bitcoin or crypto ATMs. The users can insert cash and Bitcoins are transferred to their secured digital wallets. There are also peer-to-peer (PTP) exchanges. Users can post what they are hoping to buy or sell and then choose their trading partners accordingly.

What happens if cryptocurrencies are banned?

A ban will deprive the country, its entrepreneurs, and investors of using transformative technology like cryptocurrencies. Overnight, it will erase enormous amounts of wealth held in cryptocurrencies and deprive the crypto enthusiasts of using one of the greatest wealth0creation opportunities of the next decade. 

Why are there so many cryptocurrencies?

People saw the success of Bitcoin and tried to improve existing functionality and provide new functionality with new cryptocurrencies. Additionally, investors and developers were certainly trying to make money, the primary reason why there are so many cryptocurrencies in the market.

What is the ultimate advice for investors who wish to begin investing in cryptocurrencies?

The major factor that new crypto investors should monitor and analyze is market timing. Investing in crypto is all about timing, due to its volatility and short cycles, this is the best way to handle digital currencies. Cryptocurrencies follow a cycle, which is generally pretty short, considering if the crypto will stabilize, explode, or crash, in the future. So, interested investors should monitor these cycles before investing in any cryptocurrency.

Are Bitcoin transactions taxable?

Currently, there are no rules concerning the taxation of cryptocurrencies. Even though the Indian government is has introduced its own cryptocurrency and levied taxes on crypto transactions, there is no clarity as to which cryptocurrencies can be traded.  Significant profits from Bitcoin sales can be taxed as business income or as capital gains. 

Are cryptocurrencies still used for illegal purposes?

Cryptocurrencies operate on a decentralized network, which means it lacks a centralized authority, one of the many reasons why digital currencies are quite infamous for being used for illegal purposes. Crypto holders can perform transactions without actually revealing their identities. But, the blockchain network publicly records every transaction.

Is there any fixed time for crypto trading?

Most of the crypto exchanges allow the users to trade 24 hours a day throughout the week since there is no centralized authority controlling the market.

What determines that a cryptocurrency will become important in the future?

It is generally the utility of the crypto that will determine its utility in the future. Bitcoin solves several problems regarding finances and transactions, hence, it rules the crypto market abundantly. Other meme coins like Shiba Inu do not have many real-world utilitarian purposes, hence, its value among investors is slowly declining as compared to other cryptos.