Something very new to me but after doing lots of research I could say am confident with what I know now. The cryptocurrency was born out of the need for secure communication in the second world war. It evolved in the digital era with elements of mathematical theory and computer science to become a way to secure communication, information, and money online.
What is cryptocurrency?
cryptocurrency Is a digital or virtual currency that uses cryptographical functions to conduct financial transactions and is secured by cryptography which makes it nearly impossible to counterfeit or double spend. It is an online digital asset designed to work as a medium of exchange in place for fiat (paper money) such as a US dollar and uses encryption techniques to control the creation of monetary units and to verify the transfer of funds.
Cryptocurrencies can be obtained in many ways but am going to talk about the most popular one which is crypto mining. It is the process of solving the mathematical puzzles to add blocks in the blockchain network and you take an active part in protecting the block chain network. This method is best if you are willing to spend some good thousands of dollars as it requires lots of equipment like the GPU, a strong cooling system and stable electricity since they are power intensive.
Many cryptocurrencies are decentralized networks based on blockchain technology-a distributed ledger enforced by a disparate network of computers.
Someone would ask what is a blockchain?
Blockchain is like an excel file on the network where everyone has access to it but cannot edit it since it works through distributed ledgers and is made up of blocks linked to each other. It works on some fundamentals which are actually hard to comprehend (cryptography and DLT).
Why is Blockchain important.
- Blockchain lowers the use of intermediaries, that is to say, allows you trade one to one there is no company in the middle to help you carry out the transactions for example numerous banks.
- Makes it easier to transact across borders.
- Blockchain can’t be duplicated, counterfeit and double-spent
- It can be verified and accounted for.
Blockchain is the key technology behind bitcoin. Hardly anyone uses the world’s largest cryptocurrency for anything beyond speculation. However, since 2013 schools, websites cheap airline tickets, hotels, car rentals, and cruises are accepting bitcoin cryptocurrency as a form of payment.
Bitcoin is run by a peer to peer network which transfers value using digital currency. It is the first decentralized crypto currency and was created in 2009 and is still the best known. It is currently the sixth-largest digital asset. Aside bitcoin there are other cryptocurrencies;
- Litecoin- It emerged after the bitcoin
Cryptocurrency is still in its early stages and is not yet widely adopted. But with education first and standards set to use this technology, it will soon catch up to the fiat.
Are cryptocurrencies legal?
cryptocurrencies are legal in some countries like USA and Russia, though some countries like China, has essentially banned their use, and ultimately whether they’re legal depends on each individual country. Also, be sure to consider how to protect yourself from fraudsters who see cryptocurrencies as an opportunity to bilk investors. As always, buyer beware.
Are cryptocurrencies good investment?
cryptocurrencies may go up in value, but many investors see them as mere speculations, not real investments. The reason? Just like real currencies, cryptocurrencies generate no cash flow, so for you to profit someone has to pay more for the currency than you did.
That’s what’s called “the greater fool” theory of investment. Contrast that to a well-managed business, which increases its value over time by growing the profitability and cash flow of the operation.
For those who see cryptocurrencies such as bitcoin as the currency of the future, it should be noted that a currency needs stability.
As NerdWallet writers have noted, cryptocurrencies such as bitcoin may not be that safe, and some notable voices in the investment community have advised would-be investors to steer clear of them. Of particular note, legendary investor Warren Buffett compared bitcoin to paper checks: “It’s a very effective way of transmitting money and you can do it anonymously and all that. A check is a way of transmitting money too. Are checks worth a whole lot of money? Just because they can transmit money?”
How does one obtain cryptocurrencies now that I have the wallet
Cryptocurrencies can be obtained in many ways which we are going to talk about 2 which are the most popular.
Cryptocurrency Mining is the process of solving the mathematical puzzles to add blocks in the blockchain network and you take an active part in the protection of the blockchain network. This method is best if you are willing to spend some good thousands of dollars buying the equipment (GPU, strong cooling systems), electricity bills because they are really powered intensive
Buying Cryptocurrencies from the market
Cryptocurrencies can be obtained by exchanging your fiat money with the crypto-coins for example the current price of a bitcoin is $7522.00 which so dynamic and changes with time, more about crypto prices https://cryptowat.ch/. Here you browse through the crypto market and select your favorite coin for example bitcoin(which is the most popular as per now), ETH, ripple… With your wallet ready you contact the seller as the following the platform guidelines. And viola. You have your crypto coins in your wallet.
How do I send and receive cryptocoins in my wallet
Well, for the process to be completed receiving or sending, either way. The two parties must have wallets, for example, you want to pay for some service and the company tells you they accept crypto coins, they will send you their wallet id and you will send the required amount of coins to that wallet id, as the process is simple the same in the process of receiving.
Some of the Crypto market https://cryptowat.ch/ also has a great deal of crypto market you can check out
How safe is my crypto wallet
The same way you care for your real wallet is the same way you should care for a digital wallet, by being vigilant of spams(as is the common social engineering attack).