Cryptocurrency is a term used too much around these days, that with every gust of wind it brings some new news or update about the crypto world. But every time when someone says cryptocurrency, complex, difficult, or confused is what people understand. It’s been a decade since cryptos are on market but people fail to understand the concept thoroughly. Well, what is cryptocurrency? Why are many deeply involved in this? What makes it different and fascinating? Well, many questions arise when you come across this term. Especially to those who are new to it and are looking for answers to all their instinctive questions.
Another big question that creates confusion is about the difference between bitcoins and cryptocurrencies. Cryptos started emerging back in 2009 when bitcoins started getting attention. Maybe that is the reason people get confused between both. However, for simple understanding, bitcoins are a type of Cryptocurrency. Momentarily we’re back to square one,
what is cryptocurrency?
According to Wikipedia, “A cryptocurrency, crypto currency or crypto is a digital asset designed to work as a medium of exchange wherein individual coin ownership records are stored in a ledger existing in a form of computerized database using strong cryptography to secure transaction records, to control the creation of additional coins, and to verify the transfer of coin ownership. It typically does not exist in physical form (like paper money) and is typically not issued by a central authority. Cryptocurrencies typically use decentralized control as opposed to centralized digital currency and central banking systems.”
In other words,
Cryptocurrencies are nothing but a form of virtual currency initiated to encourage investment and carry on transactions with ease like any other currency. It allows you to buy goods or services for trade to make some profit. Many companies create their own currencies, usually called tokens are similar to cryptos. For making real transactions, it becomes mandatory to exchange real money for cryptos of that value.
It is important to learn and understand what cryptocurrency is and how this world works. Proper planning, strategy, execution, and patience can help you get a lot in return from what you invested.
Dealing in cryptocurrency is more of a trend these days. People act in mob mentality and sometimes when you are not aware of what you are actually dealing in, this can land you in trouble. As a prevention from such discrepancies, it is better to know its uses and relevance to you first.
Except for the potential increase in cryptocurrency’s value, it is used in many other places other than just investment. Not just trading, but you can use your crypto savings for many other activities including leisure too.
- Exchange of money- The development in the crypto world led to many changes, crypto ATMs are the best. Here, when you are running out of cash, you can exchange cash for some cryptos you own.
- Low-cost money transfer- When you are about to make an online transfer but its transaction charges make you go gaga, try making the transaction through cryptos. Its low-cost transactions facility and immediate service can be used here.
- Investment- You can invest your cryptos in startups. More like an alternative to your check or cash transfer, when you are keen to invest in some startup, use cryptos.
- Source of interest- Like shares, mutual funds, and other securities that yield good interest, cryptos are also a source of benefits. Investing in crypto can yield good ROI making your investment worth it.
- Buy Lamborghini, world trips, or get paid for posting on social media – Yes, you read it right. Many cryptocurrencies across the world are used for these purposes. Tesla allows its owners to buy cars by making crypto payments. Some companies charge in cryptos for world trips and some companies pay you your rewards in cryptocurrencies for posting on social media and participating in the campaign.
- Wealth management- Managing finance and wealth is a critical task considering today’s situation. Cryptos are the most exciting options to use as wealth management. Many companies allow investors to use cryptos without limitations or boundaries and to reap good benefits out of it.
- Environment friendly- You can any day switch from plastic currencies or normal currencies to cryptos and go green along with helping nature and the environment. This is not the primary use, of course, but is definitely a cherry on top.
There are many companies that create their own cryptos and motivate people to deal and invest in them. However, the world’s number 1 used, invested, and capitalized cryptocurrency is Bitcoin with a capitalization of around $969.6 billion. Followed by Ethereum and 10 others are mentioned in the list below, – data based on net worth disclosed in Jan 2021.
|Binance Coin||$30.5 billion|
|Bitcoin Cash||$13.1 billion|
It is not difficult to deal with cryptocurrency once you know the uses. Apart from just using it for speculation or more like stocks, it becomes easy to deal with when you know other uses. If you want to know an easy way to start dealing in, here’s what you can do,
- Trade exchange- Pick an exchange trade on. Just like the stock market and other financial markets for securities and derivatives, cryptocurrencies are also dealt with in markets through trade exchange.
- Wallet- choose a wallet to secure your cryptocurrency. Make sure you accept the security policies and are on the same page with your passwords and credentials.
- Authentic source- Find a relevant and authentic source of information that keeps you updated with the fluctuations of the market. Bluffs and rumors can bring heavy changes. Decision at these critical times decides the fate of your investments.
- Technological use- using technology to enhance productivity and mitigate risks can help you do better in speculation. It also helps you understand and use it in different forms and ways.
- also read- Discover Indonesia, Explore the Unexplored.