How Cryptocurrency Affect the Financial Market?

Although many beginners in trading would say that performing this activity with cryptocurrencies is a challenging endeavor, still a huge number of people worldwide choose to deal with it. When you read headline news that gives different forecasts on a weekly basis, one could even say that it is a market full of turbulence. For the ‘average’ connoisseur of digital assets, it may seem the biggest problem in this market is anonymity during trading, where there are individuals who have ‘huge’ sums of coins in their hands and who could disrupt the market with their single transaction.

Trading apps are places where one can buy, sell and trade these digital coins. As with traditional currencies, it is possible to trade different types of coins for fiat or some other crypto. Trading these are based on the same concept as trading traditional currencies such as the US dollar or the euro… The only difference is that here you are trading bitcoin and so-called altcoins.

In the world of the internet, access to financial markets has become available to everyone, and it takes place through specialized trading platforms. When investing, first you need to thoroughly educate yourself. Without quality education, it is difficult to make the right investment decision. When entering any investment, you should know two things: what is the possible risk and what is the possible profit? Small investors in digital assets ignore the high risk and fluctuations in their price, which no experienced investor wants. Investing in these, therefore, sounds tempting, but there are other opportunities that, although they do not have 1,000% annual growth, provide a very high-quality investment choice. This brings us to the next point…

How do these currencies affect the financial market?

What you may read these days are the headlines stating how digital assets are a threat to the financial market, especially the ones in the USA. As the Federal Reserves have concluded. According to them, they bring out the need for a different approach and rules regarding consumer protection. Even though digital assets have the power to make every transaction way faster than what people have been used to, according to them, the risk of destabilizing the financial market is too high, as they will require adjustments in the laws and regulations of the countries. The reason they decided to tackle this question was the fact that so many people are investing, as we mentioned earlier. Apparently, more than 40% of the adult male population, aged 18-30, has already invested in them. What they have also pointed out is that these assets are being used for illegal purposes, such as money laundering.

Regardless of what the headlines say, this market does not pose a particular threat to the entire financial sector. Have you ever thought about how large this digital asset world is? It is said that its total value is around 300 billion dollars. Let’s face it, this is only a small part of, for example, the gold market, which in turn makes up 10 percent of the total world stock market. How large this market is is vividly shown with an example where the wealth of e.g. Jeff Bezos is estimated at 150 billion dollars, which means that a single man’s fortune is half of the entire crypto market.

Why do people call the bitcoin a bubble, then?

One of the most commonly used sentences related to it is that it’s in a bubble waiting to burst at some point. Other experts believe that it succeeded and overcame this phase and other instabilities. If it is in a bubble then it has been in it for more than a decade. The truth is that more and more people are buying or trying to buy this coin every day. The dream of earning huge income is mostly related to this particular coin. It is the primary reason why this number of traders keeps rising and rising.

However, since the amount of it available on the market is limited, and most of it has already been mined, investors have to keep in mind a couple of things. Some of them are:

  • Divide the money you invest between several different coins;
  • Research and evaluate for yourself what you want to invest in;
  • Buy ‘cheap’, sell ‘high’;
  • Specify the amounts and quantities you wish to return to traditional currencies;
  • For daily trading, it pays off to use an automated bot like that will monitor prices and sell and buy for you.

A transparent and integrated digital currency market leads to greater trust in digital assets on the global market, and positive examples and experiences of global brands investing in the development of their own cryptocurrency payment platforms aim to stabilize market trends in this area.

One of the optimistic examples in the market of digital currencies, for ‘average’ cryptocurrency connoisseurs, is the information that e.g. Starbucks established a platform to buy their drinks with digital coins. This information gives hope that digital assets have another purpose, besides trading, because a renowned global brand has decided to establish its own platform for bitcoins and other cryptocurrencies, which will be converted into US dollars (USD), and thus used to pay for all products they offers.


Investing in digital assets, like investing in anything else, has its pros and cons. In addition to investing, digital assets are looked upon from the point of view of their innovativeness, i.e. the disruptiveness of these innovations in the field of finance, and the new ways in which the application of blockchain technology affects the market.

The security aspects of the use and trading of these currencies will continue to be the number one topic in all media, but we should not forget that (digital) media have the task of objectively reporting and informing the public. The ‘real’ information about the current trends in the digital market, for those who wants to learn more about this topic can be found on specialized business portals in the field of finance and investments.