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Bitcoins or Stock Market?..Which is better option for Pakistani Investors?

Before making an investment decision, an investor must know all the ins and outs associated with investing. Stocks are the easiest and safest way to maximize your wealth. In the Forbes 400 list majority of the wealthiest people have maximized their wealth through making an investment in stock market. Bitcoins is another investment option which is gaining popularity among average investors. Bitcoins is based on the concept of cryptocurrency. The concept was initially introduced by Wei Dai in 1998. Bitcoin is a digital currency that despite being highly volatile is still a viable asset for thousands of people around the globe. Bitcoin simply works like a mobile app and investor can access it using a wallet that can be used for sending and transferring funds.

Out of many investment opportunities, the investors are often confused about selecting an investment.They are not sure whether they should invest his hard-earned money in stocks or Bitcoins. Here we will be presenting the five major perks of stock investment that Bitcoins lack.
Data Crashes or virus can ruin your investment:
The bitcoin is a new system and has many unexploited technical flaws associated with it. On the other side stock market has minimum to zero technical flaws. For instance, if your hard drive crashes, due to virus or malware attack on your system that results in corrupting your wallet file. It means you have completely ruined your investment and there is no any other way to get it back. It can bankrupt any investor in less than a second. While in case of stock investment you won’t have to worry about such critical and threatening factors. All your data will be secured as there is a central depository company( CDC) that is liable for maintaining and protecting all the stock data in Pakistan.
Bitcoins have no central authority:
Bitcoins is managed by individuals as there is no trustable authority managing the bitcoin. It has been running on various software. The software is set-up by the bitcoin users. The lack of financial control for the funds and chargebacks is the worst drawback of Bitcoins.Moreover, there is no one who can guarantee its valuation. It has highly uncertain and volatile nature that often disturbs investors. But in case of stocks, you won’t have to deal with these kinds of issues. Its valuation is predictable and works under the central authority that is governed by some rules and regulations. SECP and PSX is managing the trading activities within Pakistan.Companies have to disclose their financial information according to the set accounting standards.So , individual investors and analysts can easily value their stock investments on historical and current financial information.
Bitcoins have uncertainty and are still not widely accepted currency:
The currency has still not succeeded in gaining a worldwide recognition. It is accepted by some online merchants. Therefore it is not feasible for an average investor to completely rely on it. Moreover, the investment has high volatility. The Pakistan government often warns merchants to avoid using bitcoin currency due to many reasons. In case of stocks, there won’t be any big hazard as government and companies even announce their schemes and policies in advance.
The chances are greater the bitcoins can be replaced by better cryptocurrency:
There are chances that a successor cryptocurrency can replace the bitcoin. It can suddenly depreciate the price of bitcoins. Having no third party or middleman involved will result in losing the whole investment. On the other hand, stocks are valued according to their real value and management structure. Moreover, stocks have no threats from the successors.
High volatility:
The bitcoin is highly volatile that has wild fluctuating swings. Due to its changeable and explosive nature, it is only for the speculative traders. While the beginners or risk avoider will find stocks more stable due to its predictable and trustworthy valuation system. The Karachi stock exchange-100 showed a stable and continued growth in first three months of current year. The Karachi stock exchange-100 index offered 10.60 % returns in 2018. The Bitcoins futures showed consistent downfall in first three months of current year. The Bitcoins offered a negative -38 % returns in 2018.

About Emaad Qureshi