How cryptocurrencies influenced the forex market
There is no question that cryptocurrencies have found their way into the mainstream since the beginning of the Corona pandemic at the latest and have thus aroused more and more interest from small investors.
The mere fact that cryptocurrencies, especially Bitcoin , have repeatedly made it into the mass media is a good indication that they have made their way into the mass market.
But what does that mean for the forex market, i.e. the traditional market for stocks? Have cryptocurrencies managed to change this in the long term and if so, what does this change look like? Is it more positive or negative and what do forex experts say about cryptocurrencies anyway? As part of this article, we want to give you an overview of how cryptocurrencies have influenced the forex market and what these influences could entail.
Cryptocurrencies as a new currency
Cryptocurrencies were originally created with the aim of being a better form of our traditional currencies such as the US dollar, euro and other currencies. The “crypto” part in particular should be the big highlight, because it should ensure that new coins of a cryptocurrency are not simply generated, but that the existing ones can be easily transferred.
The transfers also included the fact that although these are encrypted, they are traceable in order to be able to prevent a coin from existing more than once due to the large number of participants and their anonymity, which could have led to problems in billing.
Over the years, however, this original idea has developed into a real cult for technology lovers and an interesting investment opportunity for investors, since cryptocurrencies are cryptic and therefore difficult to understand and safe.
With this popularity and the real hype that was triggered by cryptocurrencies, it finally came to the point that their value finally increased significantly. This has not only made some people particularly rich, but also shown at the same time that cryptocurrencies are also suitable as an investment in the 21st century.
Crypto and the Forex market
This opportunity for investing, which cryptocurrencies have achieved with it, has subsequently brought numerous governments around the world onto the scene, which have, for example, expressed criticism of it, like the US American one, or have recognized the potential behind it, like the Venezuelan government roughly. At the same time, the interest of large and small investors, who saw cryptocurrencies as an interesting alternative to conventional shares and funds and started investing in them, also increased.
This in turn has not only led to numerous price fluctuations on the forex market, which you can also find out more about at https://www.fxforex.com/de/broker/etoro . This has also led to many portfolios diversifying to find a way to offset rising inflation.
If experts are to be believed, cryptocurrencies are currently much more to be understood than digital gold or silver in this respect, which can have stable value in the long term, but can be very volatile in the short term. And due to the large, but not system-critical, share of cryptocurrencies in the world’s finances, a severe financial and economic disaster in the world is not to be expected even in the event of a complete crash in the courses, which currently makes many experts mild when it comes to this cryptocurrency topic.