What are the risks of divesting from digital currencies?

3 answers

• May 03, 2022 · 3 years ago
  One of the main risks of divesting from digital currencies is missing out on potential future gains. Cryptocurrencies have shown a history of significant price increases, and by divesting, you may lose the opportunity to benefit from these gains. Additionally, digital currencies provide diversification in investment portfolios, and divesting may result in a loss of diversification. It's important to carefully consider the potential risks and rewards before making a decision to divest from digital currencies.
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• May 03, 2022 · 3 years ago
  Selling digital currencies can also result in tax implications. Depending on your jurisdiction, selling digital currencies may trigger capital gains taxes. It's important to consult with a tax professional to understand the tax implications of divesting from digital currencies and to ensure compliance with tax laws. Failure to properly report and pay taxes on digital currency transactions can result in penalties and legal consequences.
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• May 03, 2022 · 3 years ago
  According to a recent report by BYDFi, divesting from digital currencies can lead to missed opportunities for passive income. Many digital currencies offer staking or lending programs that allow holders to earn additional income. By divesting, you may miss out on these opportunities to earn passive income from your digital assets. It's important to consider the potential income streams associated with digital currencies before deciding to divest.
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