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Blockchain and crypto craze in Kenya-Africa: Lessons learnt

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With all the theories coming up in regards to blockchain technology, it is almost impossible to predict when the bubble will burst or what will cause its disintegration. Blockchain technology, the technology behind the formation of cryptocurrencies, has been hyped a lot lately. For instance, the price of Bitcoin, a premier cryptocurrency, has been skyrocketing over the past few months with its current price being over $20,000. However, given the risks and uncertainties that are associated with blockchain technology, it is advisable that one should first know what this revolutionary technology entails and the benefits that come with it.

In Kenya, for instance, despite the warning by the CBK, Kenyans gamble millions in high risk of Bitcoin mining without taking time to evaluate the technology and fully understand the risks that come with it. Some even quit well-paying jobs, like in the case of Aerlene Mugambi who quit her job at a local telecommunication company to concentrate on online digital trading.  It is of great importance for investors to note that they can save themselves from huge mistakes by learning to build wealth that can last without being tempted by risky investing fads.

Below are some of the lessons we can learn from the current blockchain and crypto infatuation:

Never invest in things that you do not understand

For you to venture into blockchain as an investment, you need to know the basic information about it. What is blockchain and how does it work? What is a cryptocurrency? How reasonable is it for a single cryptocurrency, for instance, Bitcoin, to be worth over $20,000 today as opposed to the $685.75 it was worth in November 2013. If none of this makes sense to you as an investor, it is advisable to stay away. There are easier to understand investments that one can undertake and reap much profit.

It is important to choose a strategy and stick with it

If you decide to invest in companies with growing dividends, stick by that. Other people may prefer other approaches like investing in stocks and digital trading because they have adequate knowledge about them. The key thing is to choose a strategy that suits your knowledge and risk tolerance, and then focus on it. However, if you constantly get distracted by everything new that comes with technology, you are less likely to achieve your goals

Not everything that is exciting is worthwhile

Sometimes boring is beautiful. Notably, you should strive for boredom if you want to make money through investing because normally there is a long wait before you start reaping profits. The excitement about blockchain might not end so well bearing in mind that its skyrocketing prices of the cryptocoins like bitcoins are extraordinary, to say the least.

You cannot be rich overnight

It is not realistic to invest in something that you hope will triple or quadruple within months, as it will lead you into trouble more often than not. It is important to learn how to control the pressure of wanting to make quick monies, as it will serve you well in the end.

Missing out is okay

We have heard of people who bought mansions and real estates with profits gained from trading bitcoins. It is also possible to hear of people who lost their lifetime savings because they invested in blockchain and its cryptocurrencies.

We do not have a way of controlling the outcome and the future of blockchain technology, but having adequate knowledge of how it works can help an investor or an individual on how to play their cards rights and reap huge benefits. Always risk what you are ready to lose.

However, wish to state bitcoin is not intended to be an investment vehicle; it is not a betting game or gambling activity. In the meantime, before the buzz goes fizzles test the technology with an amount you afford to lose and maybe you can reap big or lose big time. Therefore, as the saying goes “I am interested in the underlying technology”. This technology perceives bitcoin as a currency allowing for open without the need for intermediaries, censorship-resistant, decentralized, neutral and border-less transactions. Many people will be caught up in the “bubble” for assuming cryptocurrencies are new ways of investing which is contrary to the objective of blockchain and other disruptive technologies.

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