Is Forex Better than Cryptocurrencies
At present, it is the cryptocurrency industry that has attracted the highest number of investors to the industry. It is because the cryptocurrency industry is in the approach of every common person and it is believed to be highly lucrative and profitable. This is a fact that may be true with cryptocurrencies but to many analysists, it is a short-term trend. On the other hand, majority of the online trade analysists and experts tend to side with forex trading. Although both sectors deal with currencies but they have fundamental differences, which give forex a lead against cryptocurrencies.
Now there will be a comparison between forex and cryptocurrencies to know how exactly forex has leverage over cryptocurrencies in the first place:
Foundation of Cryptocurrency Industry
When we compare cryptocurrencies to forex, we come to know that the cryptocurrency has been around since 2009. This means that the cryptocurrency industry is just over a decade old, which means that it needs to spend a lot of time before it matures up.
The basic foundation of the cryptocurrency industry was on the basis of providing complete ownership to people over their personal and financial information. Another reason behind the foundation of cryptocurrencies was to provide people an alternative to traditional financing sector. The industry is decentralized in nature, which means that it has no central entity governing the system.
While decentralization offers users the ability to have ownership of their information, yet it poses a great risk which involves money laundering and other criminal activities. The cryptocurrency industry has no physical existence and it runs completely through the computer networks. A drawback that the cryptocurrency industry has is that it is fully unregulated, which is why the regulators are always opposing the industry. They are always warning their investors and citizens not to invest in cryptocurrencies and stay away from such trades.
The cryptocurrency industry is also very volatile, which means you have chances of making a lot of money as well as losing all that you have. The cryptocurrency industry has also faced a lot of heat due to many scams as well as money laundering cases that have emerged in the recent years related to cryptocurrencies.
Foundation of Forex Industry
When it comes to Forex trading, the industry has been around for millennia and it was introduced as soon as the internet platform was introduced. The online forex trading sector has been around for several decades and it has observed constant growth and adoption. The forex trading industry has garnered huge user base through the online platform who are making decent amounts of money.
At present, forex trading is known for observing daily trading volume, which is higher than $6.5 trillion. On the other hand, the daily trading volume for cryptocurrencies is just some hundred billion dollars a day.
As forex currencies involve fiat currencies, therefore, they have a lot of reputation and market presence. These currencies are the ones the countries are using for trades and other activities. Therefore, they can never go out of fashion, thus, the trading activities for forex continue taking place.
The currency pairs being trading in forex have physical value and existence. This makes fiat currencies being used in forex very reliable and demonstrate extremely low volatility. Forex trading is legal in every country while countries such as China, Australia, Turkey, Russia, and many more have banned cryptocurrencies. This is the reason why people still hesitate investing in cryptocurrencies but they are fine investing in forex.
Another major advantage forex has over cryptocurrencies is that the industry is fully regulated so you should not be worried about your trades. However, you may end up losing your money in a natural way if you do not pay attention of forex markets.
For now, cryptocurrencies need a lot of time to compete with forex but as forex is dealing with fiat currencies, there is no way crypto can achieve what it is aiming to achieve for several years.