What is cryptocurrency? That is one of the most important questions you will ask yourself as you begin to explore this new frontier. There are many different types of cryptocurrencies, some better than others, some that have died off, and some that are still going strong.
Many people refer to all cryptocurrencies as ‘coins’, but this term can be misleading. Some coins are not used for currency (yet!), they are instead referred to as tokens or digital assets. Just make sure you understand what each type of coin is used for!
There are several reasons why someone might choose to invest in crypto. One reason is that it is such an ever-growing industry. Technology has made it possible to create almost anonymous currencies that are easy to use and transfer. It is also very popular at present due to the growing popularity of Bitcoin. People want to get into investing in crypto so there are just lots of opportunities to learn about it.
Another good reason to invest in a crypto is the potential return on investment. Many successful investors are millionaires now because they invested well in the early stages of crypto. By investing today, you could potentially become a wealthy person later.
History of cryptocurrency
Many people get hung up on what defines a coin as “real” or not, but they forget that it is not only the term used to describe it but also the technology built onto the base platform that makes Bitcoin different from any other currency.
Bitcoin was originally designed to be an online currency where individuals would have their own wallet accounts stored on a blockchain. They would use cryptography to secure these wallets so that only they could access them, thus shielding your money from being hacked.
This system was first implemented in 2009 and since then there are over 1,000 cryptocurrencies with various designs and features. Some are more private than others, some are faster than others, some are more energy-efficient than others, and some appeal to the public better than others.
But none of this matters unless you can rely on them!
Publicly trusted currencies like USD and EUR are great because people trust them, they work, and they are easy to find. But if they ever go away or become scarce, your savings are gone. This is why we recommend staying within each individual’s budget and keeping an eye out for warning signs (e.g., if someone doesn’t believe a coin will last, chances are it won’t).
Skewers like BTC and ETH exist at a very basic level, but they don’t offer enough flexibility or anonymity and therefore aren’t considered truly decentralized.
Who created bitcoin?
Bitcoin was invented by an individual named Satoshi Nakamoto in 2009. He published his invention to a now-famous cryptocurrency discussion forum called Bitcointalk, along with the whitepaper that later received the name “Bitcoin paper.”
The word “bitcoin” does not appear anywhere in the paper. The term is coined by another member who asked if it could be made private, making it similar to how some people refer to the internet as the web. This member also suggested adding a prefix to make it more distinctive, so it was added.
Since then, many have speculated about who this person might be, but no conclusive answers have been found. Many believe that the individual is probably dead, although there has been speculation that he lives under a different identity. Others think that they know who Satoshi Nakamoto is, but they are either lying or using someone else’s account at the time of creation.
What is a Smart Contract?
A smart contract is an application or script written in computer code that uses cryptography to facilitate, automate, and/or reward the execution of a predefined task. The term “contract” was first used in 1981 when developer Danny O’Brien coined it for his decentralized digital money concept called Neuromantric Coin.
Since then, the word has spread beyond just cryptocurrencies like Bitcoin. Now you can create your own contracts using any cryptocurrency as currency!
Many people refer to this new technology as blockchain due to the distributed ledger nature of all transactions. This article will talk about how to start investing in cryptocurrency, including what types of coins are most worthy of attention.
Differences between cryptocurrencies
There are many types of cryptocurrencies! That is one of the biggest differences between this technology. Some, like Bitcoin, have been referred to as cryptocurrency. Others use cryptography to create their currency instead.
There you have it! You now know two of the most important things about cryptocurrencies. Let’s dive in and learn more about them!
What is mining?
Mining is what allows for new coins to be created with every transaction. Each time someone sends or receives money using a cryptocurrency, there has to be a process that happens before that change can occur. This process is called “mining.”
The miners who perform this work get compensated through either reward of coins or by being paid in fiat (regular) currencies. Most popular cryptocurrencies reward people via rewards systems similar to BitCoin Faucets where they give away free coins.
Some pay in fiat directly such as Dash which uses Amazon gift cards. These payments go towards supporting the network, funding user wallets, and promoting the coin.
Which ones are worth investing in?
This is definitely not an easy question to answer! It depends on your goals and what you want from these technologies.
Popular cryptocurrencies
What is cryptocurrency?
Crypto means currency or money in its most basic form. Technically, anything that people agree to value as money is considered a crypto token. This includes things like Bitcoin, Litecoin, Ethereum, and many others.
However, none of these coins are actually worth more than others due to their limited supply. This means even though someone may have a lot of bitcoin, they would be spending their bitcoin on products and services which use other tokens for payment. The price would then drop because there are not as many bitcoins available to be spent.
This is why it is important to understand what makes a coin valuable. It is not just how much money you can spend on goods and services with it, but also if you can exchange it for fiat (normal) currencies or not. Some cryptocurrencies cannot be converted into dollars or euros, making them less useful.
Another thing to watch out for is whether or not the person offering the crypto has been involved in fraudulent activity before. People will advertise all sorts of ways to make money with a new cryptocurrency, but some will be scams. Avoid investing in any coin unless you know it is safe and legitimate.
Investing in cryptocurrency
Now that you have done your research, gathered all of your belongings, and are ready to invest in cryptocurrencies, the next step is to choose which ones!
There are several ways to invest in cryptocurrency. You can go through an exchange like Coinbase, where you can purchase Bitcoin or Ethereum directly.
This way is great for people who are very familiar with exchanges already and have a lot of resources at hand. But what if we were talking about buying cryptocurrency for the first time?
Well, there are many other options out there! You can create your own digital currency by mining (which will be discussed later) or purchasing from another person or company’s ICO (Initial Coin Offering). Both of these strategies have their pros and cons so it really depends on the individual investor on how much risk they are willing to take.
ICOs are very common these days, especially among newer investors. An ICO is when a company creates its coin as well as some technology or software using blockchain technology that they want to sell.
Buying bitcoin
So you have decided to start investing in cryptocurrency! You are already making an excellent choice by choosing Bitcoin over any other currency. Let us talk about how to buy bitcoins!
Bitcoin is probably the easiest way to purchase crypto coins. There are many ways to acquire BTC, but most begin with going to a site that sells them. The sites will usually offer very good deals as well as direct purchases from Coinbase or Gemini (both of which we discussed earlier).
By shopping at these sites directly, the seller will likely use their own private wallet to store the Bitcoins they receive. This helps prevent theft due to additional security measures put into place.
There are also some methods that require buying either Ethereum or Litecoin first. These can be done through exchanges like Coinbase or Gemini where you can then transfer your Etherium or Litecoin to the purchased coin.
This article will not go into detail about all of the different ways to buy BTC, there are just too many! But here we will discuss one of the best ways to do it.
Selling bitcoin
There are two main ways to sell your bitcoins. You can offer them for sale through an online cryptocurrency exchange, or you can choose to liquidate by selling directly for cash at a store that accepts cryptocurrencies as a form of currency.
The first is probably the best way to go about it if you’re just starting out. By exchanging your coins with another person, you get the chance to find someone else who wants what you have and will give you the price you want.
Some exchanges even let you buy or sell without any fees! The drawback to this method is that you will need to find people willing to pay you top dollar for your BTC, and there may be no takers depending on how much they believe in the future success of Bitcoin.
With Cash, What Are Your Options?
Selling via ATM – This is usually done through a company that offers such services. You take your money, either paper or digital, and use their equipment to purchase some crypto. Then you withdraw it however you like- for personal or business use.
This removes one of the key factors in buying Bitcoin; where to spend it. Some sellers will be offering premium cards that work similarly.
