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- A cryptocurrency is a form of digital money
- Highly centralized and hence not regulated
- Big houses like Tesla have said that they will allow cryptocurrencies to purchase their products
The last few days, one would have heard about the term cryptocurrency with more regularity than the climate broadcasts. Why do some people vouch for its utility while others scoff at the idea? In a nutshell, cryptocurrency is hailed as the future, while others hate it because it will weaken a stable financial order. However, no one can ignore it. It leads to a pertinent question- How does cryptocurrency work? How safe is it?
Bitcoin, The leader
Yahoo Finance reports that one Bitcoin is worth $40,000 in US dollars. In 2010, a single Bitcoin was worth only 8 cents in USD, according to Investopedia. However, the value fluctuates wildly and at one time had reached $65,000 before falling. Bitcoin appeared in 2009 as the first digital currency. Unlike Paper currency or Debit Cards, which represent the buyer’s wealth or paper currency in a Bank, Bitcoin does not have a physical form. It is stored digitally and hence affords better security compared to checks, paper currency, and even digital transactions. All the above structures and instruments of financial transactions represent the exchange of paper money held in accounts.
Other Crypto coins
Bitcoin was the first Cryptocoin that came into existence in 2009. Today there are more than 6,700 cryptocurrencies traded on public markets, according to the website CoinMarketCap.Bitcoin and other cryptocurrencies can exchange goods and services on the private market but are not considered legal tenders like the Japenese Yen or the Euro. Ethereum, Bitcoin Cash, and Litecoin are the best-known cryptos, and one can purchase them through Paypal. Electric vehicle manufacturer Tesla invested in Bitcoin and announced it would allow consumers to buy its cars using cryptocurrency. Other crypto coins which are not well known are termed Altcoins. One altcoin which is much in the news these days is Dogecoin which has got the support and patronage of Elon Musk.
What Is Crypto Finance?
Rob Zel, founder of crypto exchange bitni.com, cryptocurrency is a fully decentralized peer-to-peer electronic money implemented by cryptography. Since it is not regulated in any form, the risk of fluctuations is always there. However, the security risks and chance of fraud with Bitcoin or other cryptocurrency trading have dramatically reduced. The only chink in the armor is due to the highly secure nature of transactions; purchases cannot be traced. Drug dealers and terrorists can use this to buy the wares of their trade and make it difficult for law-enforcing authorities to track and prosecute them.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
