5 Things You Need to Know About Cryptocurrency
The momentum surrounding blockchain technology and cryptocurrencies is hug; but just how familiar are you with the concept of crypto? As opposed to fiat ones, cryptocurrencies are virtual currencies that are not linked to traditional banking systems or governments. Decentralized cryptos are digital currencies that are based on cryptographic systems.
Here are 5 facts that you need to know about cryptocurrencies
1. They have no central control
Crypto can be transferred securely from one peer to another through wallet addresses without any need to use a third party. Introduced around 2009, Bitcoin (BTC) was the pioneer and is now the leading cryptocurrency by market value. But there are thousands of other cryptos such as Ethereum and Litecoin, and so on.
Ever since they were introduced some years ago, cryptos have been disrupting the financial landscape to a great degree Governments have little power over the crypto movement. But they would probably do anything to stop it — if they could.
2. They are anonymous.
There is a high degree of anonymity associated with crypto transactions. When you use crypto to make transactions, you can stay anonymous. This is something that cannot be done with fiat. In the age of data mining, your personal information isn’t 100% secure as long as you use the internet to make online payments. For instance, with BTC, people can hide their identities while transacting financial businesses online. Having said that, you may still want to install virtual private networks (VPN apps) to secure the rest of your online activities. VPS will shield your internet activities from your ISP and also ward off hackers.
3. The crypto market is liquid.
As long as the internet and blockchain exist, the crypto market will always be open 24/7/365. Traders can trade all year round without a break. Investors can transfer their funds across the globe instantly from anywhere to anywhere. The convenience of crypto transactions is a key factor that attracts more investors and traders to the industry. If you want to buy & sell Bitcoin with cash instantly, visit NakitCoins homepage for more info.
4. Cryptocurrency has no counterfeit
It’s possible to trace every crypto transaction made through the blockchain since the records are publicly available. Although their IDs are anonymous, the location of crypto tokens can always be known. However, cryptos are always legit and you can’t counterfeit them. On the other hand, central banks only know rough estimates of how much fiat currency is in circulation. They can’t pinpoint its location. Meanwhile, counterfeit fiat currencies exist.
5. Cryptocurrencies are volatile
One main feature of cryptos is that they are highly volatile (fluctuate in value). To investors, high volatility means that the investment is risky, but at the same time profitable. For example, the price of one BTC can spike from $7,000 to $10,000 in one day. It can also fall massively within a short time. If you are thinking about investing in BTC or any other crypto, ensure that you invest only what you can afford to lose. The market is always unpredictable.
Cryptocurrencies are becoming more popular with each passing day. As of May 2020, the entire crypto market value stood at around $267 billion. Experts in the industry are making millions of dollars. But before you venture into crypto, take time to do your homework and invest wisely.