Basically, a new form of digital payment in mind, a cryptocurrency, or as it is most widely used, cryptocurrency is the digital currency contemplated to replace fiat money to purchase goods and services – at least that was what was in mind initially. Bitcoin, the cryptolord of them all, surely started flapping its wings with such purpose however the landscape that geo-formed afterwards took incredible shapes just like the evolution of life itself has done. But fret not, since this very crypto for beginners guide is aimed at being a loud and clear crash course for the aficionados of the digital currency market.
What is Cryptocurrency?
Well, to be more technical, it is actually the sum of tokens that run on a platform generally called blockchain that aims to decentralize, speed up and encrypt transactions so that they are immune to any forgery, holding all records of movement on the network on that online ledger in a distributed fashion.
As of the time of writing of this beginners guide, CoinMarketCap reports more than 12.500 crypto currencies circulating all around the globe recording a market capitalization nearing 2,3 billion US Dollars. The market is undoubtedly dominated by Bitcoin (BTC) at a rate of 46 percent while it is trailed behind by the widely acclaimed Ethereum with 18 percent. The market cap follows Cardano, Binance Coin, Tether, Ripple, Solana, Polkadot, USD Coin and the good boy Dogecoin respectively.
How to Invest in Cryptocurrency
Of course, we are not waltzing through a golden age where income is no longer a problem – everybody is investing in crypto for a number of reasons. First things first: Bitcoin? Profit. Kind of. It has peaked at such high numbers that it has well past its initial x10 days however this does not make it any less valuable – only coaxing the crypto fire with new altcoins (any coin other than Bitcoin) that are looking to multiply its value times over its original one. Crypto coins are also embraced because they purposefully cast controlling figures and authorities out. Decentralization means less intrusion, more democracy and more privacy – “power to the people” briefly. The technology behind it is also thrilling to many – Blockchain proves to be more than a backbone specifically crafted for a digital asset, marshaled by Vitalik Buterin’s Ethereum, there are many projects that act as the light-bulbs to dark corners. Last but not the least, many believe them to replace traditional payment methods for the better one day, in a far more efficient way, both cost and time-wise.
Cryptocurrency Trading for Beginners
Generally, where somebody makes a lot of money, it is generally bled from others’ wallets – and the rule still applies in the next gen financial world as well. Cryptocurrencies are a good investment – in certain cases turn people’s lives around corners they could not dream of in an absurdly short period of time, however lose your senses and it is a car crash against the wall. The volatility still persists even with the oldest of them all – any roses you spectate in crypto gardens stand over a graveyard of failed projects. Digital currencies are solely backed by excitement, fear and the demand thereby so you should keep a cool head at all times and not risk any money you cannot afford to lose.
Legality of cryptocurrency accounts is another topic of consideration when you are testing the waters: For example, lately, China which was home to the largest mining pools of the world has altogether banned anything related to crypto coin trading which led to quite some shift both in exchanges and epicenter of technologies. On the other side of the world though, the central authority of the USA, SEC, tries to align national interests with digital currencies while El Salvador embraces Bitcoin as its legal “tender”.
When you are ready to mingle with the currencies of the future – you would have to find a reputable crypto exchange you could trust with your money and start investing in, preferably, an array of cryptocurrencies. Remember, not all eggs are in one basket.
We should probably conclude this crypto for beginners post with worthwhile advice to wrap up: You wouldn’t buy a goat because it is a popular thing to do, do your research to see if it is rational to invest in a cryptocurrency and accept anything that comes after. Do not forget that “whales” can host goats for a future not too long for them, but not you!