What is a cryptocurrency?
Cryptocurrency is basically a virtual exchange medium that uses a cryptography in order to secure its transactions and control the creation of the system units. Meaning, cryptocurrency simply represents money in the digital marketplace nothing else. It is based on an open-source software, cryptography and networking. It lets people or users avoid fees or the lowest fees as compared to what your banks are charging. The system takes part in the non-cash transactions that is anonymous while guaranteeing a secure transactions.
Cryptocurrency is associated with internet using cryptography process converting legible information into an almost uncrack-able digital code, impossible to crack transfers and purchases.
Why use cryptocurrency?
Basically, cryptocurrencies are known for its extreme security and anonymity to the highest level. Transactions made by this system cannot be reversed nor faked and compared to what your local bank are doing in its client charging high transaction fees. In cryptocurrency the fees are to the lowest level, making it reliable than the conventional currency in the marketplace. Its decentralized nature means they can be available to everyone, in which banks can only be available to those they permitted to open accounts.
Cryptocurrency is a new generation cash, the cryptocurrency marketplace known this that currency that could take off high value even overnight. But same works the other way around. People who invest on cryptocurrencies must be aware on its volatility in the market and the possible risk when buying it.
How many cryptocurrencies exist in the web?
There is no exact number of existing cryptocurrencies exist in the ecosystem, this is because the code of the cryptocurrency is an open source, this means that anyone has the chance to create their own version of cryptocurrency by just using the code. But as to this moment, the estimated cryptocurrencies in the marketplace is about more than 900, along with the data embedded on them, which can be seen on the list of registered coins.
What was the first cryptocurrency?
The first cryptocurrency that was recorded in the digital data was bitcoin, created in the late 2009 and still as of now the best cryptocurrency known in the marketplace. A creation of cryptocurrencies has started emerging in the past decade and now more than 1000 cryptocurrencies can be found on the internet.
What are the most common cryptocurrencies?
- Bitcoin: This cryptocurrency was the first in the ecosystem and the most commonly traded cryptocurrency until today. In 2009 Satoshi Nakamoto developed Bitcoin, a mysterious digit who developed blockchain. For the record it has a market capitalization of $45 billion dated 2017 of July.
- Ethereum: 2015 is the year Ethereum was born, a token based currency used in Ethereum blockchain, it is placed in the second in rank on the most valuable and popular cryptocurrency in the marketplace. Ethereum has market capitalization of $18 Billion as of 2017 of July. Ethereum had a very turbulent journey. After a major hole causing it to be hacked in 2016, as result it split into two currencies, the value of Ethereum in recent months has reached high as $400 but crashed to as low as 10 cents.
- Ripple: a cryptocurrency uses a distributed ledger and it was created in 2012. Ripple has a feature to track the type of transaction made, not just cryptocurrency. Ripple has been used by UBS and Sandander, it has more than $6.3 billion market capitalization.
- Litecoin: Litecoin is a cryptocurrency that is similarity with bitcoin, but move quickly on its developments, this includes more faster payments and processes more transaction at a time. The estimated overall value of Litecoin is more than $2.1 billion.
What is alternative currency?
A cryptocurrency is an alternative way if you want to transact something besides from the use of international or national currency. This currency is created by individual, organization or corporation, it can also be created by national, local or even state governments, or they can simply arise naturally as people agreed to use them as their common currency in the marketplace.
Is it that difficult to obtain cryptocurrency coin?
This depends on some factors. But in general, if the kind of cryptocurrency was just recently introduced in the marketplace, the computing power needed in order to mine the coin is obviously low compared to the highly established crypto currency in the market.
These are list wherein you can acquire cryptocurrency coin.
- Accept payment for a certain goods and services offered in the market.
- Purchasing specific coins on legitimate exchangers online.
- By simply exchanging coins to someone you know or some that is near you.
- Earning it by simply mining.
What is Cryptocurrency Mining?
Mining any type of cryptocurrencies basically needs powerful hardware and the right software. The value of the currency highly depends on the units available in the marketplace, they are carefully monitored in a very accurate process. Mining cryptocurrency is the process of generating units in the cryptocurrency.
To understand better, let us assume a large economy with billions of dollars in banks altogether. Now, since this situation is not physically possible for them to store these currency notes in banks, so they store it in a digital format with central reserve bank. The reserve bank then maintains a digital record of what it was owed to bank but doesn’t keep the notes in physical form. So whenever it needs to push money into the system and short of its notes, they will be printed and issued.
Why should I get involved in cryptocurrency?
Because most people believed that it is profitable. Anyone has the option to mine its coins or simply invest into them. The expanding ecosystem provide a multiple opportunities on the possibility of doubling or even more your current assets.
What was more convincing was that, cryptocurrency value are evaluated constantly and then re-evaluated as more people join the network. At beginning, cryptocurrency revolution was at 100$ initial investment that could brought hundreds or even thousand profits. Till date, this kind of opportunity is still available.
What is a cryptocurrency wallet?
This is all about storing a cryptocurrency, wallet concept can be daunting a bit for the uninitiated. Basically, there are wallet software (this can be desktop, online or mobile), hardware based wallets, and of course the paper wallets. Talking about the “best” wallet in the ecosystem will be different for each one of us, it depends on a particular needs.
Wallets don’t just store cryptocurrency directly. It is accurate to think wallet as storing private keys. The Public key cryptography allows cryptocurrency to function, and uses a specific algorithms in order to generate pairs of keys. Public key is the address to which anyone can send its cryptocurrency balance. The private key allows owners spend funds from the specified address. Without the private key, public address becomes bottomless pit that you can only see; money still be sent there, but lost without a private key.
The type of wallets simply represents various ways a certain can secure their secret private key. There are two main types of cryptocurrency wallet, the hot and cold, these refers to the level or internet connectivity of the wallet. Paper wallet and hardware wallets are not actively connected to internet and considered as cold storage. Hot wallet is internet connected wallet, easy to spend, but vulnerable to cyber-attacks. A cold storage protects you from cyber-crime, but still it will be the owner’s responsibility to secure their property.
What is cryptocurrency exchange and market?
A cryptocurrency market and exchange are both service in web, allowing cryptoccurrency token holder to trade to other currency or conventional monetary to their system. According to record, there are more than 2000 cryptocurrency exchangers in the ecosystem, among the largest are Bitstamp, Cryptsy, and Coinbase.
How is the cryptocurrency value determined?
The value of cryptocurrencies are ranked in a value or unit times and the cost of exchange to buy equals the capitalization in the market. For instance 1 Steem coin is worth $1.50 on Poloniex this rate was in the previous month. But the price can move at any moment, the market capitalization is only an estimate of the overall value of the digital currency.
What are the exciting reason for you to get involved with the digital currency?
With the ability to immediately transfer cash in just a matter of seconds to anyone around the globe from its wallet without having any fees or at lowest rate. Digital currencies enables spending and receiving money 20 times easier compared to your traditional wire transfer, western union and Paypal.
The digital currencies are just like real cash, meaning this can be used to merchants that received this kind of currency that you are holding, some merchants prefer to receive cryptocurrencies. Because in in cryptocurrency ones the payment is send, there is no chances the sender can get it back compared to PayPal or Strip in which customer can perform chargeback in which merchants loose the funds.
There is a higher possibilities that in the near future, all transaction will be done in a user to user system with the help of cryptocurrencies.
What will be the worst part about cryptocurrencies?
Like any other reasons on the digital world, losing your password or make mistake in your transaction then you will lose your funds or the account itself forever with no chance of getting it back. Cryptocurrencies are extremely serious and there’s no second chance at all, so make sure to take extra careful to everything you do with your wallet. Once locked then it’s a good bye to your account. To make worse, your cryptocurrency wallet are easy to rob compared to a what bank has. For instance your wallet is open on a computer then anyone has access with it, your overall balance could be washed out without any trace.
Even Law enforcement at less than NSA level is not able to help out unless the thief itself is sloppy beyond belief because of its convenience of moving the funds to any cryptocurrency through anonymous transaction makes tracking nearly impossible to those individual that has no access to the real time worldwide electronic monitoring system which is no one is going to allow use in case of a stolen cryptocurrency.