Everything you need to know about cryptocurrency
If you’ve ever wondered what cryptocurrency is, or how it works, you’re in the right place. This article covers everything you need to know about cryptocurrency, including where it comes from and how it’s made, as well as what to consider before investing. You’ll also find some cryptocurrency price predictions so you can get an idea of whether the market has seen better days or not! If this all seems a bit confusing, don’t worry — we’ll walk you through all of it step by step!
Chapter 1: History
The genesis of cryptocurrency dates back to 2008 when Satoshi Nakamoto published a paper titled Bitcoin: A Peer-to-Peer Electronic Cash System. Within it he described Bitcoin as A purely peer-to-peer version of electronic cash [that] would allow online payments to be sent directly from one party to another without going through a financial institution.
The original intent was for Bitcoin as a medium of currency exchange. It is believed that Satoshi mined approximately one million bitcoins before disappearing in 2010, after which nobody knows what became of him or her. In 2011, programmer Laszlo Hanyecz exchanged 10,000 bitcoins for two pizzas, establishing bitcoin’s first known commercial transaction.
Chapter 2: How To Invest In Cryptocurrency
Investing in cryptocurrency can be risky, but it’s not necessarily prohibitively so. One thing many people miss about cryptocurrency is that it isn’t a stock—there aren’t any shares of Ripple or Ethereum that you can buy.
Rather, these currencies are an asset, much like gold. You aren’t investing in a corporation or owning a piece of a pie when you invest in Bitcoin or Ether; instead, what you own is essentially just their digital token—the part of their blockchain they use to track transactions and generate currency.
Chapter 3: How Does Cryptocurrency Work?
Cryptocurrencies are a form of digital money used for financial transactions that are decentralized, meaning it isn’t controlled by one specific organization.
At its most basic level, cryptocurrency is an encrypted piece of code stored on blockchain technology. This information can be shared across a network of computers and accessed via computer or smartphone. That access has led to increased freedom—and paranoia—as people wonder how central banks and governments might regulate cryptocurrency.
For example, because cryptocurrency isn’t regulated by centralized entities, its use in criminal activity has been suspected; after all, cash can also be used anonymously. But even if you aren’t worried about criminals using cryptocurrency for illegal purposes, there are still several reasons why some people have concerns about cryptocurrencies’ rise in popularity.
Chapter 4: How Do You Use Cryptocurrency For Payments?
You may not be familiar with cryptocurrency, but that doesn’t mean you can’t accept it as payment. Cryptocurrencies are growing in popularity, and many people want to use them for payments because they can be used across borders and don’t rely on banks. Here are some of your options.
With certain types of cryptocurrencies, you’ll be able to use them for free. Other cryptocurrencies may require that you pay a fee—or they may allow users to send transactions for free as long as they pay higher fees if they want their payments processed more quickly.
Chapter 5: Best Practices For Crypto Investments
Just like with any investment, when you’re putting money into cryptocurrency, make sure that you do so safely and with knowledge about what you’re doing. Research is crucial before throwing in your money—take a good look at how much of a given cryptocurrency exists on its network and who backs it.
Cryptocurrency investments aren’t for everyone; if these kinds of investments don’t sound appealing to you (and they’re highly volatile), think about how else your portfolio can be diversified. Just because one type of investment might not work out for you doesn’t mean that no investment will, so be sure to have options available.
Any time you’re putting money into a new venture, make sure that you do so safely. Because cryptocurrencies are a relatively new phenomenon, we don’t fully understand all of their intricacies. If at any point it sounds like what you’re doing is too good to be true, there’s a very high likelihood that it is.
Only invest in cryptos that seem legitimately interesting and worthwhile—if they’re not something your everyday person could use, don’t be convinced into investing just because of how cool they sound. It can also help to check up on your investments periodically.
Even though many people hold onto their cryptocurrencies for extended periods (sometimes even years), remember that these investments can change quickly and drastically.
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