Is Bitcoin a Good Investment?

If you bought $100 worth of Bitcoin in early 2010, today you’d have more than $20 million. With those kinds of returns, it’s hard not to think, “Can I get in on that?”

Bitcoin, the largest cryptocurrency by market cap, is a good investment if you have a high risk tolerance, are in a strong financial position and want to increase your portfolio’s exposure to digital currency. It’s not a sure thing, however. Its extreme price volatility, regulatory uncertainty and limited utility are red flags for some. While it allows people to make international transactions at a relatively low cost and protects users’ privacy through the innovative use of a decentralized blockchain, skeptics argue it does so at a price that vastly overstates its true value. Others say it’s worthless — a bubble that will one day pop.

If you choose to invest, it’s important to maintain a diversified portfolio that includes several different types of investments to reduce your overall risk exposure….

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This article was written by Kurt Woock and originally published on www.nerdwallet.com