What are cryptocurrencies?
Cryptocurrency is a minted word that represents a new digital currency that is backed up with cryptography in order to validate and verify transactions and ownership. The first cryptocurrency was recognized to be Bitcoin, and today we have seen many different cryptocurrencies claim to be the “true” Bitcoin. Currently the most popular forks of Bitcoin have been Bitcoin Cash, Bitcoin SV, and Bitcoin Gold. Other coins exist outside of Bitcoin which have different use cases. These coins are often referred to as “alternative coin” or “altcoin” which means it is similar than Bitcoin. Digital coins utilizing blockchain technology can be called as an altcoin. Altcoins can have different policies or rules that differ from Bitcoin, such as spending limits, mining structures, and for example positive or negative interests.
What is a Bitcoin?
Bitcoin is a digital currency that was released in 2009 by Satoshi Nakamoto, who to this day is still unknown. It is also unclear if Satoshi Nakamoto is a person or a group although many theories exist. Bitcoin has many special attributes that have made it so popular such as being a decentralized ledger. Decentralization means that there is no set authority, government or political party that controls the supply or regulation of the currency. This idea of decentralization is very popular because it is an idea of “unseizable” money. The whole process is run on a “peer to peer” network which allows each participant to be equally privileged with distributed tasks. New coins are brought into the world each day through the process “mining” which resembles a lot of the same attributes traditional mining has. It is also to take note that coins can be split up into fractions, and more specifically “Satoshis” which can split Bitcoin 100,000,000 times. So the smallest Bitcoin unit is one Satoshi which is 0.00000001 Bitcoin. The maximum number of Bitcoins that can ever exist is 21,000,000 which will help create demand for it once the supply is capped.
Is investing in Bitcoin and cryptos safe?
This is a common question that is asked from newer investors in cryptocurrencies and is certainly a good one. Investing in cryptocurrency can be safe, but just like any other investment in the traditional world there are some drawbacks. You should be aware that at the moment the nature of cryptocurrency prices are very volatile thus one can lose almost all of the investment or gain it back with multiples. It’s good to study crypto market price history data and make some rough conclusions. When mainstream adopts Bitcoin or other cryptocurrencies the prize will hopefully stabilize but before that there is a good opportunity to earn some money or digital assets.
Where to buy Bitcoin and other Cryptocurrencies?
The most common way to buy cryptocurrencies is to use an online exchange. Other ways to purchase Bitcoin and other cryptocurrencies can be seen through Local Bitcoins (which is like a crypto craigslist), Bitcoin ATM’s (In select locations with often higher fees) or accepting crypto as a payment. If you own a business online or in person, accepting Bitcoin as a payment can be an easy way to acquire Bitcoin or other cryptocurrencies and will offer a net benefit to the cryptocurrency ecosystem. Millions of retailers are accepting Bitcoin already!
Coinbase – Extremely user friendly, very easy to create an account and purchase Bitcoin, Ethereum, Litecoin and Bitcoin Cash. It also has a very smooth mobile application which is very helpful when you are on the go. Coinbase is located in the USA and was launched in 2012, San Francisco, CA. Users are able to purchase cryptocurrency using their bank account and credit card information, and allows its users to cash out via their bank or PayPal. Over 32 countries supported. They are now supporting instant transactions and offer good support. Read more from Coinbase review.
Binance – This exchange is very popular and available in most places, but does not allow for fiat deposits or withdrawals yet. If you want to be able to invest in a huge selection of other cryptocurrencies but don’t own any cryptos yet it would be a good plan to first deposit money for example to Coinbase and then transfer cryptos from there to Binance exchange. Read more from Binance review.
Have a good time studying and investing in cryptocurrencies! The more you know about the subject the smaller the luck factor becomes. However CryptoZone sincerely wishes you good luck with your new digital asset investments!