Answers to the most important questions: How can I join the crypto boom?

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Most people have heard of cryptocurrencies. Most of the time the most famous cryptocurrency Bitcoin and its increase (or loss) in value are mentioned. However, it is unclear to many how crypto trading works and what this means in terms of opportunities, risks or investment volume. However, cryptocurrencies are gaining popularity and opening up new opportunities for investors to diversify their portfolios alongside securities.

Why should you invest in cryptocurrencies?

Historically, cryptocurrencies like Bitcoin have shown impressive increases in value despite price fluctuations. Digital assets are considered an alternative asset class, allowing you to participate in innovative technologies and can be an interesting complement to traditional assets. As with all investment products, it is important to weigh the opportunities and risks. It’s also important to assess your risk tolerance in advance: How much volatility can you tolerate emotionally and financially?

What are the risks of cryptocurrencies?

Cryptocurrencies are volatile. The example of Bitcoin shows that after a record high of $59,000 in November 2021, the price fell by almost half in just a few months. Therefore, your risk tolerance needs to be determined before investing. You should also distribute your investment assets across different products and titles. A crypto savings plan, where smaller amounts are regularly invested in cryptocurrencies on a self-determined rhythm, reduces the impact of short-term fluctuations.

Why do banks trust cryptocurrencies?

“Crypto-based assets have become an integral part of the financial world and our customers want access to this market,” said Philipp Merkt, Chief Investment Officer at PostFinance. Until now, trading was complicated, required technical understanding, and often went through exchanges abroad because your own bank did not offer cryptocurrencies. However, surveys show that it is preferable to trade at your own Swiss financial institution. In particular, because it is a safe and familiar environment for storing the private key, that is, the key that facilitates access to digital assets and transactions.

What is the advantage of trading crypto in a bank?

Trading crypto via bank offers several advantages:

1. Buy, sell and access on an established and trusted financial platform.
2. At PostFinance, assets are stored in Switzerland according to the highest security standards.
3. Trade through your own account without having to worry about technical details or private key.
4. Swiss banks are subject to strict regulations. Crypto regulation is also in place, protecting investors, with clear regulations for cryptocurrencies and blockchain technologies providing additional security.

Digital currency trading occurs directly from buyer to seller, whether through exchanges, brokers or peer-to-peer. Requires technical understanding. You need a wallet (digital wallet) and you must take care to keep your access data safe. If this so-called private key is lost, digital assets are also irreversibly destroyed.

Do I need my own wallet?

No, anyone who manages cryptocurrencies through a bank can carry out buying, selling and storing transactions in the e-banking environment. Keys to digital assets (private key) are stored according to high security standards. Customers don’t need to worry about keeping the key safe themselves.

Are cryptocurrencies only for the rich?

No, it is possible to start crypto trading with small amounts. For example, you can invest in banks through crypto savings plans, where you can determine the amount and regularity of investments yourself.

Do I have to pay taxes on cryptocurrencies in Switzerland?

Yes, cryptocurrencies are considered assets and must be taxed in Switzerland. If cryptocurrencies are bought and sold through a bank, the bank creates an asset summary for the tax return.

Where can I find more information about cryptocurrencies?

Financial service providers have numerous blogs that provide comprehensive information about cryptocurrencies. The websites of individual currencies also provide interesting information. Numerous podcasts and YouTube videos discuss cryptocurrencies, so it is important to check the reliability of the sources. It is also useful to follow news from reliable sources.

Source : Blick