Cryptocurrency, which is oftentimes referred to as crypto, is a groundbreaking digital asset that has taken the world at large by storm.
That right there still seems vague, doesn’t it? You do not need to worry. With the help of this guide, we’ll take you on a step-by-step journey on crypto and all it entails. If you can follow along, we’re almost sure you should by the end of this, have a basic grasp of what the whole fuss on crypto is all about.
What are Cryptocurrencies and How Does it Work?
Cryptocurrencies are a form of digital currency that uses cryptography as its source of security. It is designed as a form of exchange that offers a purely digital and decentralized alternative to the traditional money we’re used to. This innovation relies on a technology called blockchain to ensure transparency and keep control out of the hands of a single body or entity.
Now that we now have an idea of what crypto is, the next question that needs answering is; how does it work?
We’ve touched a little on what blockchain is. But seeing as the whole crux of the working of cryptocurrencies relies on it, we’ll have to further explain it. So, what is blockchain?
The foundation of any cryptocurrency is blockchain technology. This technology is a decentralized ledger that keeps track of every transaction across a series of computers. To further break it down; a group of transactions which you can refer to as a “block” links to other blocks thereby creating a chain. That is what it is in essence.
What is the Use of Crypto?
Since you now understand how crypto works, the next order of business is its usage and application.
Investment
Many institutions and individuals nowadays buy these coins as they’re also alternatively called, in hopes that their value will increase over time. In situations where it happens to rise, they can sell it and turn in huge amounts of profit. You should however not engage in this venture without proper knowledge of crypto trading.
You might have at one time or the other come across the term “HODL”. It might seem like a misspelling of “hold”, which it kind of is. Crypto experts use this term to describe this practice of buying coins and holding them to sell in the future when their value increases.
In Bookmakers and Casinos
Gambling institutions were one of the first to adopt the usage of crypto in payments; both deposits and withdrawals. It is a very convenient and reliable way to make deposits whenever you want to place stakes and also to collect your winnings. 1bet is an example of a bookmaker that actively uses Bitcoin for this purpose. Some of the benefits you’ll get to enjoy when using cryptocurrency on 1bet include
- Secure transactions.
- Anonymity
- Special bonuses and promotions.
However, before you begin crypto transactions on any bookie, ensure you go through the terms provided.
A Payment Method
As a result of the security and anonymity crypto transactions offer, various individuals have adopted it as the next best way of making payments.
Most institutions and business enterprises now accept it as a form of payment for both goods and services rendered.
3 Most Popular Cryptocurrencies in 2023
To get more insight into what cryptocurrency is as a whole, we’ll be looking into 3 of the most popular coins in 2023.
Bitcoin (BTC)
This is the coin that made the world of cryptos become as well known as it is today. It is the most popular cryptocurrency in the world and holds a leading place among other coins.
In 2009, an anonymous person or group known as Satoshi Nakamoto created BTC, with the primary aim of serving as a decentralized digital currency. Bitcoin has now become a pioneer and benchmark for all others.
Ethereum (ETH)
The main feature Ethereum introduced into the crypto landscape is its smart contract capabilities. With this, it established a foundation for building other decentralized apps.
Just like BTC, ETH is also subject to price volatility. This means its value can be influenced by several factors.
Tether (USDT)
This coin is unlike Bitcoin and Ethereum in that its price is designed in such a way that it remains stable. Hence why they refer to it as a stablecoin. Its main purpose is to be consistent in value with whatever fiat currency is linked to it. So, looking at USDT, we can say it is the digital version of the US dollar.
How to Store Cryptocurrency?
Intending to ensure the safety of your digital assets, there are various options available for you to store them. We’ll list some of the common options available for you to pick whichever meets your criteria.
- Software wallets.
- Hardware wallets.
- Crypto-Exchange wallets.
- Mobile Wallets.
Cryptocurrency Advantages
In this day and age, the benefits cryptos offer are several. But we’ll be looking into a few, while also showing you how to enjoy them.
Security and Transparency
The use of blockchain technology in cryptos makes transactions open for everyone to see. Networks are also secured with cryptography. This makes it impossible for fraudsters to carry out their nefarious activities.
Decentralization
This is the major feature used to identify any coin. The government or any central authority has no access to control a cryptocurrency. With this, it removes any risk of censorship or manipulation by any individual.
Transaction Speed
Have you ever made an intercontinental transaction through your traditional banks? If you have, you can attest to the amount of time these payments take. However, cryptos eliminate this issue. Payments can be processed in minutes, no matter the distance.
Final Words
Cryptocurrency is now a leading force in the financial aspect of human life. So, with the knowledge you have gained from this guide, you should be able to expand your horizons into the crypto atmosphere.
