03 Nov 2023
With around 4 million expatriates spread worldwide, Ghana is one of the African countries whose people live amidst financial challenges. A large number of Ghanaians face unemployment resulting in poverty. They manage to travel abroad to earn a living and send money to Ghana to offer financial aid to their family back home.
Their financial contribution to the country’s economy is substantial. The quantum of inward remittances they sent back in 2022, according to a World Bank report, was $4.66 billion.
It is not only about simply earning a living that you go abroad for. There is another critical aspect of working abroad too.
Do you know what that aspect of an expatriate’s life is? What is it that you have to consider while working abroad?
That critical aspect is to look for opportunities to make investments.
You can save money to make investments, but the bigger challenge is to choose one option for investment among innumerable investment options. One such investment option buzzing nowadays is cryptocurrency.
However, investing in cryptocurrency is not as easy as it may be in real estate or gold. It is a complicated field, and you may not be aware of the technical complexities involved. But worry not! This blog is your guide to cryptocurrency.
Cryptocurrency is a decentralised digital currency that does not have a physical form. It exists only online. This digital currency exists in a blockchain on a server. It stores financial data in blocks without personal identification.
Cryptocurrency transactions are highly encrypted to hide personal information.
Its most popular versions are Bitcoin and Ethereum, but over 10,000 different types of cryptocurrencies are currently in circulation.
Initially, people were doubtful about digital assets competing with traditional ones. But cryptocurrencies increased in popularity since their launch, which drew the attention of people to them.
The Ghanaian migrants who support their families through a money transfer to Ghana are also attracted to cryptocurrency.
They save money to consider cryptocurrency for investments.
For savings, you need to learn about money-saving tips while you work abroad as a Ghanaian migrant. Because your investment largely stems from your savings.
Before understanding cryptocurrency at length, let’s understand Blockchain, which forms the basis of this virtual currency.
Blockchain is an open and distributed ledger that records financial transactions in coded languages. It is like a chequebook that is distributed across millions of computers worldwide.
All the transactions thus made are recorded in blocks, linked together like a chain of all previous cryptocurrency transactions.
The users of cryptocurrency can keep their copy of this book to have and maintain a unified transaction record with the help of blockchain.
Every new transaction is automatically logged, and every copy of the blockchain is updated with new information, which keeps all the records accurate and identical.
For fraud prevention, two following techniques are used.
Remember that both of these methods are used to verify cryptocurrency transactions and prevent fraud which is pretty much the norm in this digital currency.
Not only is fraud prevalent in cryptocurrency dealings, but you also must be aware of and guard against online fraud in your online money transfer to Ghana from overseas because online money transfers are also highly vulnerable to online scams.
Let’s now look at the advantages and disadvantages of investing in cryptocurrency.
The advantages of cryptocurrency are explained below.
About 10,000 cryptocurrencies have one thing in common. They offer you a sudden spike in the value of the currency, which has the potential to give you huge rewards.
Investments inherently offer risk. But the basis of cryptocurrency, explained briefly earlier, is secure and safe from fraud. All the transactions are recorded in the virtual ledger simultaneously to update the record all at once.
Traditional financial systems include intermediaries in their operations, which means trusting someone you barely know or just do not know. But in cryptocurrencies, you deal directly without any intermediary whatsoever.
Cryptocurrencies are always open and do not operate on a fixed schedule, as is the case with traditional banks. This allows you to access the trade and take part in it anytime and even when you are on the go.
Cryptocurrencies like Bitcoin and Ethereum serve as a shield against inflation. This is because the number of cryptocurrency coins is fewer in the market. When inflation increases, it boosts the prices of cryptocurrency, thus shielding you from the impact of inflation.
The disadvantages of cryptocurrency are explained briefly below.
You will take a while to get your head around cryptocurrency. It is pretty complicated to understand and involves several technicalities. This is one reason why people are reluctant to invest in it.
The price of cryptocurrency spikes to unbelievable heights; it can come crashing down at the same pace and just as quickly. It is, thus, an extremely volatile investment and may not be the best investment bet for you.
If you are looking for a long-term investment option, then cryptocurrency is not the best investment option. It is just over a decade old, so people and investors are still wary about it, which adds scepticism and uncertainty to it.
Digital currencies operate at a fast speed. But after a certain point, their speed begins to slow down. It is called the scalability issue. It makes it difficult for it to roll out at a large scale. You will find it pretty annoying and frustrating.
You run the risk of losing the private key that gives you access to your coins and all your holdings with it. Seasoned investors can avoid it, whereas new investors are vulnerable. So, cryptocurrency is pretty unsafe for new investors.
Thoroughly evaluate these advantages and disadvantages before investing in cryptocurrency.
Whether you invest in cryptocurrency or choose any other investment option, your investment depends on how you save money. One of the ways you can save money easily is to choose ACE Money Transfer to send money to Ghana online to get live and market-competitive currency exchange rates, speed, safety and much more for low fees, all of which help you a long way in saving money.
Ans. Cryptocurrency is a decentralised digital currency that does not have a physical form, and it exists online and virtually. It is based on blockchain technology scattered across millions of computers.
Ans. You should consider investing money as a Ghanaian migrant to secure your future financially. You cannot earn a living abroad forever. So, before your job draws to an end, make safe investments to secure your future financially.
Ans. The safety of your cryptocurrency investment depends on several factors, such as your understanding of it, your experience, the overall investment environment in a specific field, and so on.
Ans. The advantages include high rewards, transparency in the system, financial security, round-the-clock access to the cryptocurrency market since it is all digital, and protection against inflation.
Ans. The disadvantages include complicated technicalities involved in understanding the system, volatility of the market, security risk for new investors, and capacity limitations.