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What is Cryptocurrency?

What is crypto currency

What is Cryptocurrency?

A Cryptocurrency (or “Crypto”) uses an online ledger with strong cryptography to secure online transactions. Much of the interest in these unregulated currencies is to trade for profit, with speculators at times driving prices skyward.

The most popular cryptocurrency, Bitcoin, has had volatile price moves this year and as of 13th December 2021, Bitcoin is at 48,000 USD

So in layman terms, Cryptocurrency is a form of payment that can be exchanged online for goods and services. Many companies have issued their own currencies, often called tokens, and these can be traded specifically for the good or service that the company provides. It is important to note that you’ll need to exchange real currency for the cryptocurrency to access the good or service.

Cryptocurrencies work using a technology called Blockchain.

Blockchain is a decentralized technology spread across many computers that manages and records transactions. Part of the appeal of this technology is its security.

It is important to take note that as the Cryptocurrency grows alongside the Blockchain technology, there are more than 15,000 different cryptocurrencies are traded publicly, according to CoinMarketCap.com, a market research website.

The total value of all cryptocurrencies on Dec. 13 2021, was about 2.3 trillion, having fallen off an all-time high above $2.9 trillion weeks earlier. The total value of all bitcoins, the most popular digital currency, was pegged at about $932.4 billion.

So the main question here is, why are Cryptocurrencies so popular today? Why is it trending amongst the new generation of traders? Why are stock traders shifting over to Crypto Trading instead?

  1. Cryptocurrencies such as Bitcoin has been of a high demand. Whales are racing to buy them at a low price, presumably before they become more valuable. (As predicted by experts on cnbc that it will reach 100k) 
  2. The existence of Cryptocurrency removes central banks from managing the money supply, since over time these banks tend to reduce the value of money via inflation.
  3. There is currently a growing technology behind Cryptocurrencies, the blockchain, because it’s a decentralized processing and recording system and can be more secure than traditional payment systems.
  4. Speculators like Cryptocurrencies because they’re going up in value and have no interest in the currencies’ long-term acceptance as a way to move money
  5. As of 2021, the main point of Cryptocurrency is to fix the problems of traditional currencies by putting the power and responsibility as it welcomes the decentralization and transparency to say good-bay to intermediaries.

While some cryptocurrencies, including bitcoin, are available for purchase with U.S. dollars, others require that you pay with bitcoins or another cryptocurrency.

To buy cryptocurrencies, you’ll need a “wallet,” an online app that can hold your currency. Generally, you create an account on an exchange, and then you can transfer real money to buy cryptocurrencies such as bitcoin or Ethereum.

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So what are the important points to take note of while you choose the right platform?

  • Who owns the company? An identifiable and well-known owner is a positive sign.

  • Are there other major investors who are investing in it? It’s a good sign if other well-known investors want a piece of the currency.

  • Will you own a stake in the company or just currency or tokens? This distinction is important. Owning a stake means you get to participate in its earnings (you’re an owner), while buying tokens simply means you’re entitled to use them, like chips in a casino.

  • Is the currency already developed, or is the company looking to raise money to develop it? The further along the product, the less risky it is.

It can take a lot of work to go through these details but the more detail it has, the better your chances it’s legitimate. But even legitimacy doesn’t mean the currency that you are eyeing on will succeed.

That’s an entirely separate research and understanding. I highly recommend that you consider my Crypto Wellness Services while the slots are limited for 2022.

From my perspective, the cryptocurrency market will develop at a pace set by the key participants who are optimistic and positive about the growth of certain coins that have a good solution for the public and a strong foundation of investors and developers.

For the market to reach the next phase in its evolution toward mainstream acceptance and stable expansion, each of the five key market participants—merchants and consumers, tech developers, investors, financial institutions and regulators—will play a role. It will become more of a trend as we see it evolving into a possibility for real estate transactions and a lot of other types of transactions as well. With how the Metaverse is growing thanks to Mark Zuckerberg, this will be a slow progression. Why is it a slow progression? Because there is still a lot of skepticism surrounding crypto and I think some of that is healthy skepticism for sure. I don’t think it’s something that everyone would be comfortable with. But I think it’s interesting also to note that there are a lot of companies that are increasingly accepting Bitcoin to pay for things.