Cryptocurrencies vs. Real Estate Investing

Oluwagbemi Amojo Written by Oluwagbemi · 2 min read >

Which Investment Is the Better?

Investing your money is one of the most effective strategies for accumulating wealth and saving for retirement.

There are many investment options available to every investor, and each investment has some distinct benefits and drawbacks.

Have you ever questioned which investment is better, cryptocurrency or real estate?

To begin, what exactly is cryptocurrency? Cryptocurrency is a kind of electronic money that we can use to buy goods and services. Many individuals are now investing in cryptocurrency to benefit from trading.

The Advantages of Cryptocurrency Investing

Cryptocurrency is distinct from conventional money in that it is decentralized, meaning that no single organization governs or controls it.

Cryptocurrency may be purchased in pieces for as low as N5,000, given the variety of currencies available on the market.

Another benefit of cryptocurrency is that it has a relatively low entrance barrier.

Cryptocurrency also has long-term potential for exponential growth.

Disadvantages of Cryptocurrency Investing

Cryptocurrency is not a tangible asset since it lives only on the internet.

Cyberattacks, as well as other forms of cybercrime, may deplete your cryptocurrency holdings.

Cryptocurrency is very volatile. This volatility makes investing difficult for even the most risk-averse investor since you are well aware that you might lose the total value of your investment at any moment. Bitcoin increased from about $10,000 in October 2020 to more than $60,000 in April 2021 in less than a year. It then fell below $30,000 in mid-July 2021 before rising 31% in the last week to $39,000. Bitcoin is hardly the first cryptocurrency to experience such severe volatility. Bitcoin increased from $1,000 to well over $20,000 in 2017. After about four months, the value had reverted to $7,000. This volatility challenges even the most risk-tolerant investor. As you are aware, your investment may lose its absolute weight at any moment.

Let us now discuss real estate. The word “real estate” refers to the process of developing, purchasing, and selling real estate. Investing in real estate is one of the most effective methods to create wealth and save for retirement, and it has survived the test of time as an investable asset.

The benefits of Real Estate Investing

Real estate is a physically observable, touchable, and tactile asset.

It is a relatively safe investment.

You have the option of accelerating the asset’s appreciation. You may implement strategic changes that will result in increased monthly rentals or returns.

Real estate generates a consistent revenue stream, resulting in a passive cash flow!

Investing in Real Estate also has its drawbacks.

While real estate does have some significant advantages, it also has some drawbacks.

Contrary to stocks, which can be purchased and sold at any moment, real estate investing is not as liquid as other assets.

Additionally, real estate is a significant financial investment to acquire and maintain.

The real estate market is growing at a moderate pace. Its prices are steady, with just a few instances of price surges.

Returns on real estate investments may take time to materialize.

People find it far more challenging to make sound financial choices due to the variety of accessible alternatives.

However, throughout the years, many investors have gravitated toward real estate and cryptocurrency. Both of these strategies are very effective for long-term wealth growth. While more individuals are interested in purchasing cryptocurrencies, the real estate sector regularly attracts new investors.

“All sensible investment is based on the concept of value investing – getting more than what you pay for.”

Charlie Munger

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