Everyone is buzzing about cryptocurrency, but what is all the fuss about and how can you get involved? Here is a quick guide to everything that you need to know about cryptocurrency.
What Is Cryptocurrency?
Traditional financial institutions and digital payment processing companies like ExpressComp offer the transactions and services that we are used to, so cryptocurrency is a new game for most of us. Cryptocurrency involves exchanging real currency, but you are buying “tokens” or “coins” of your chosen cryptocurrency.
The coins/tokens get stored in a digital wallet that comes with a private key, which you will use to “sign off” on digital purchases. Cryptocurrency work on blockchain technology. The blockchain grows with every exchange, so it is like a long receipt.
What Kinds of Cryptocurrency Are There?
There are currently over 6,700 cryptocurrencies, and it is likely to keep growing. The estimated value of all cryptocurrencies is above $1 trillion, as it has seen a huge boom in the past few years. Of course, there are different cryptocurrencies that you can choose from. The most popular choices include Bitcoin, Tether, Ethereum, and Polkadot.
What Can I Do with Cryptocurrency?
You can use cryptocurrency to pay for services and goods, similar to casino chips. Often, companies have their own special kind that you can use to purchase their goods and services. Some people use their cryptocurrency to invest in start-ups.
Most people like to cash out their cryptocurrency if the value increases enough, and there are many services available to turn your currencies into actual cash. Surprisingly, it has other uses too. Many people use crypto to quickly and cheaply send huge transfers, which can happen in minutes and cost a fraction of traditional transfer fees. Other people use their digital wallets to safely keep their cash since authorities cannot freeze personal wallets, but it is a bit of a gamble since the value of crypto can change quickly.
Should I Invest in Cryptocurrency?
The main question that everyone wants to be answered is if they should invest in cryptocurrency. If you are perfectly stable for practically the rest of your life, then you can give it a shot. Typically people without debt, have emergency savings, already investing, and have most of their future set-up are good candidates to invest in crypto. However, it is not a good option if you are looking for quick cash.
You will likely have to invest a lot of cash into crypto right away if you want to see long-term results that are worth it. Otherwise, you would invest your money without much return if you are not careful. Additionally, you have to be prepared to not see that money for a while if you want actual profit from it. Therefore, cryptocurrency investment is better for people who are looking for long-term income.
Cryptocurrency can be a wise investment, but only when you know more about it and know exactly what you are doing. Be smart and do as much research as possible before putting your money into cryptocurrency.