I am not sure if I understood your question correctly. Are you asking what is the risk of having too much faith on cryptocurrencies and therefore sinking too much money into it? If that is the question, do allow me to provide my humble opinion.
First of all, it is important to recognize any form of investment/asset comes with its risks. Although economics textbooks like to consider government treasuries as "risk-free" assets, there is really no such thing as zero risk. We have seen the Greek government defaulting and it can technically happen to any other governments.
Coming back to the topic, is it too risky to be heavily involved in cryptocurrencies. My opinion now is, yes. The main reason is that it cryptocurrencies are still highly speculative. Furthermore, there are too many of them out there. Hence, it is very difficult to predict which one will hit mass adoption in the years to come.
Personally, I invest in cryptocurrencies with a sum of money which I can afford to lose. I am treating it as a hedge against risk on fiat currencies. Not that I think fiat will collapse suddenly overnight, but the risk is there. Just take a look at what happened to the Venezuelan Bolivar and, more recently, the Turkish Lira. To sum it up, like any asset, cryptocurrencies come with its own risk. At this formative stage, the risk is higher than most other traditional assets. But over time, as the technology progresses and adoption rises, they will be seen as safer assets. Therefore, at this stage, invest with only what you afford to lose and you will do fine :)
I am not sure if I understood your question correctly. Are you asking what is the risk of having too much faith on cryptocurrencies and therefore sinking too much money into it? If that is the question, do allow me to provide my humble opinion.
First of all, it is important to recognize any form of investment/asset comes with its risks. Although economics textbooks like to consider government treasuries as "risk-free" assets, there is really no such thing as zero risk. We have seen the Greek government defaulting and it can technically happen to any other governments.
Coming back to the topic, is it too risky to be heavily involved in cryptocurrencies. My opinion now is, yes. The main reason is that it cryptocurrencies are still highly speculative. Furthermore, there are too many of them out there. Hence, it is very difficult to predict which one will hit mass adoption in the years to come.
Personally, I invest in cryptocurrencies with a sum of money which I can afford to lose. I am treating it as a hedge against risk on fiat currencies. Not that I think fiat will collapse suddenly overnight, but the risk is there. Just take a look at what happened to the Venezuelan Bolivar and, more recently, the Turkish Lira. To sum it up, like any asset, cryptocurrencies come with its own risk. At this formative stage, the risk is higher than most other traditional assets. But over time, as the technology progresses and adoption rises, they will be seen as safer assets. Therefore, at this stage, invest with only what you afford to lose and you will do fine :)