Today, science and technological advancements are progressing at a pace of light. When the human race shifted from a state of barter system to introducing coins and ended off with paper bills as a medium of exchange who would have thought currency would have transformed into sole numbers kept and stored in bank accounts. Well, evolution is a part of life, and humans are mere puppets playing their roles in that. In this human changing evolution, cryptocurrency is another invention that is made by Satoshi Nakamoto. A Japanese software developer who started off the first blockchain decentralized digital currency also known as Bitcoin in 2008. In a simple definition, Cryptocurrency is also like a bunch of numbers stored in your bank account just with a little difference of being a separate currency on its own and the currency is purely intangible, stored digitally in online ledgers. Coded with blocks embedded with chains this the secured mode of transaction or medium of exchange.
How does Cryptocurrency Work?
In centralised currencies when a transaction is taking place there is a third party involved within the transaction. That third party is generally referred to as the government body or the financial institution of the respective country in with the currency transaction is taking place. Here crypto states a different story. All the transactions taking place in cryptocurrency will only involve the buyers and sellers of the goods or services. No hidden charges or involvement of taxes to the government body is applicable in the transaction. Each coin you own has a chain of blocks embedded within, and the blocks have a specific hash value which is the sole determinant of how much it worth is your crypto coin or cryptocurrency is standing in the market. All the transactions are stored in online ledgers making it nearly impossible to hack or get pass through without proper access credentials.
Now you might be wondering why to go through such fuss in making the exact amount paid. It’s not like we are getting any additional discount for making the payment in crypto. The advantage is though you are to be payable of the real value of the cryptocurrency you possess is determined by how much of your form of crypto is demanded and supplied. If demand is high and the supply of the crypto is less, then the price will rise up, and if the demand is less then supply is abundant the value will decline. Another advantage is that of the transaction you are making with the vendor there are no hidden costs involved in the market, as there is no third party involved in the transaction. This is known as the Peer-Peer transaction which is quite similar to the old age barter system we used to follow. The government can not intervene in the market and can not impart any sort of taxes making the price for your good or service comparatively lower.
Forms of Cryptocurrency:
The world comprising 195 distinctive countries has its own 195 distinctive currencies. Similarly, the cryptocurrency has different forms or sub categorised blockchains, but these currencies are not determined by change in countries’ centralised decisions but a change in hash values. Each block of crypto has its value of its own and when added up it gives a total value of the respective currency. The word ‘Blockchain’ is derived with this simple concept of individual blocks having individual hash values and chained in one. The most popular form of cryptocurrencies are:
|Bitcoin (CRYPTO:BTC)||$826 billion|
|Ethereum (CRYPTO:ETH)||$390 billion|
|Binance Coin (CRYPTO:BNB)||$79.5 billion|
|Cardano (CRYPTO:ADA)||$66.3 billion|
|Dogecoin (CRYPTO:DOGE)||$63.4 billion|
|Tether (CRYPTO:USDT)||$58.2 billion|
|Bitcoin Cash (CRYPTO:BCH)||$20.1 billion|
Making money with Crypto
The phrase “TIme is money” has never been so accurate. In Cryptocurrency people are making a lot of money as their passive as well as active incomes with this one principle of time and money. Among all the methods the popular ways by which one can money with Cryptocurrency are:
- Trading: involves a simple method of buy and hold. A lot of investors and individuals buy cryptos like bitcoin or dogecoin at a lower price rate and sell out when the price of the coin increases with the increased amount of being the profit.
- Mining: In calculating hashes present in blocks over thousands of cryptocurrencies stored in online ledgers blockchains need high powered computer consoles or pcs as a resource to perform these tasks. Mining is just that of utilising your system as a resource for their own and paying you in the exact form of currency you choose to mine. Later that currency can be converted into money depending upon the valuation of the market and transferred to your bank accounts.
In our recent times of modernisation where people are touching their dreams and making money as the second, you are reading this article, it is very crucial to understand how to make proper utilisation of the money that you are earning. Savings and Investments are the building blocks of your future. But as the world changes, we find different opportunities to make our investment. Cryptocurrency is the next best investment opportunity one can find in the market. If we follow past trends we can observe the inclination of how the value of bitcoin is increasing day by day. In the last year itself, we found bitcoin to double its phase value. But there’s always both sides of the coin. With high returns comes the factor of high risks. It may also happen that the value of your purchase may decline over time. So, it is very crucial to understand the market while making the best uniform decisions for your investment.
All in all, as the world is changing we should know how to adapt to the changes. The new era of digitalisation has brought up many opportunities and the path will continue to flow. Hope this was helpful. Tried to impart as little as I know with this article. Thanks for reading.