Cryptocurrency has been making the buzz since a long time. Viewed as the next big thing among the big investors and economists. Today, cryptocurrency has become a global phenomenon. Garnering curiosity from every corner of the globe.
So what exactly is crypto currency? As the unknown creator of cryptocurrency currency, Satoshi Nakamoto, puts it in his words, “it’s a peer-to-peer Electronic Cash System”. A cryptocurrency (or crypto currency) is a digital asset designed to work as a medium of exchange that uses strong cryptography to secure financial transactions, control the creation of additional units, and verify the transfer of assets. It is used to leverage technology to gain transparency and immutability.
So are there any benefits in using crypto currency? It challenges the traditional way of controlling finances with a central authority: the decentralised nature of blockchain make it theoretically immune to old ways of government control and interference.
A transaction can be easily done between two individuals or parties by the use of private or public keys. These transfers will cost you minimal processing fee, allowing user to escape the high fees charged by the traditional institution of finances.
It is very transparent and highly secure. As it lack the interference from any centrally authorized system.
if you want to invest the bitcoins, you can Invest on cryptocurrency like Altcoin? Altcoin stands for “alternative to Bitcoin”, is use to describe any cryptocurrency that is not bitcoin.
So what exactly is altcoins? Altcoin stands for “alternative to Bitcoin”, is use to describe any cryptocurrency that is not bitcoin. Altcoin are created by diverging from Bitcoin consensus rules (the fundamental rules of the cryptocurrency’s network) or by developing a new cryptocurrency from scratch. Although it inherits the same fundamental building blocks of bitcoin. However, this approach is relatively easy to carry out because Bitcoin is a open source platform. When an altcoin forks at the blockchain level, an alternate system of consensus rules must be used and the coin will have an entirely different distributed ledger. The same is true for altcoins built from scratch.
Some Altcoin have entirely different monetary policy rules build into currency to encourage different use and treatment. Policy such as minimum spend or positive or negative interest on coin stored can encourage or discourage holdings. This may function different from Bitcoin, as it coin mining works differently, as number of coins paid out when new mine has been mined.
So at the end of the day, are Altcoins the possible future? Despite the previous failure, 2019 has been rather preparatory for various other cryptocurrencies. The capitalization has already reached over $130 billion. Although, this market is still negligible, yet it is still gaining momentum.
For further development of the blockchain market and for it to become a full-fledged participant in the global economy, institutional investors should use digital money in day-to-day tasks – investment and pension funds, insurance payments, banks transfers, and so on.
However, large and serious players cannot enter a dubious industry or an unregulated market. They need regulated infrastructure, ready for large flows of funds.
An American TV broadcaster and a crypto currency bull said, as people slowly starting to understand the store value of cryptocurrency offers. People will move their funds back into cryptocurrency.
Is it worth investing in? The cryptocurrency market moves in a cycle and understanding these cycle is the key to profiting, managing risk and keeping sane.
As Howard Marks describes, two ways of profiting:
- Hold more things that rises the market and less of things that falls.
- Cycle adjustment or trying to have more risk exposure when market rises and less they fall.
Most people tend to neglect the second part. Yet the key to profit is to understanding where you’re in the cycle. Calibrating the risk and rewards to account for.
The risk and profit debate can be on going. It’s like Schrödinger’s cat theory. Although their is a possibility of you gaining profit, it can be either be futile as well. One must invest in authentic source. Has to do their research before diving into it, as to save themselves from scammers.