Say there’s a coin that currently worth hundreds of US dollars, but it’s not gold or platinum or any precious metal. Some says it’s the way of the future, some says it’s just a scam, other call it magic internet money. What Cryptocurrency is exactly? Well, stick to the article till the end to find out what it is exactly.
Today I am here with another way of making money. But this time it’s a little intense topic, so keep reading till the end to know this astonishing way of making money. Let’s just start by understanding the basics.
What is cryptocurrency?
Cryptocurrency is a digital asset designed to work as a medium of exchange using cryptography. We use it to secure the transactions and to control the creation of additional units of the currency. Usually when we say the word asset it’s something you can see and touch, now the word digital here is giving us the idea that is something that is virtual.
Why do I need cryptography if I am using digital currency?
Well, cryptography is the practice and the study of techniques for securing communication in the presence of third parties called adversaries. Remember that when we trade in the internet this is a insecure place, so we need to secure all our transactions and all out communications.
Cryptography is all about constructing and analyzing protocols that prevent third parties or the public from reading private messages.
As we are in the 21st century and we are living in the information age. But we don’t store our information on pin and paper behind a locked safe.
It’s stored digitally, therefore we need to have an ability to secure this using software and this is where the cryptography comes in.
How can you get started?
Now if you’re wondering how to get on this platform then you really will need to get a wallet.
Let me tell you that a cryptocurrency wallet is a software program that stores private and public keys. It interacts with various block chains to enable users to send and receive digital currency and monitor their balance.
In the bitcoin system everybody gets their own private key. One should never show those private keys to anybody else. And a third party called a block chain verifies it.
Now if you want to use bitcoin or any other digital cryptocurrency. Then you will need to have a digital wallet as it allows this process to take place. It’s just like sending email to someone. As you need have an email account and other person also needs to have an email account whether it’s Gmail, orbit, Yahoo, outlook or whatever. And this is how the bitcoin works, like you can’t trade bitcoin unless you have got a digital wallet.
How to buy and sell Cryptocurrency?
So you’re exchanging your fiat money to cryptocurrency. You’ve got a wallet and now you want to trade whether its US dollars, INR or Euros. And you’re going to convert this to Bitcoin or other cryptocurrency. As there are literally hundreds of cryptocurrency but the Bitcoin is the most popular.
What are the risks?
Now this is the most important things to know before signing up for cryptocurrency world.
Your keys could be stolen: It is as obvious as giving someone your PIN code of your bank card, they can withdraw your money. And it’s the same with the bit coin like if you give someone your privates’ keys then you will lost all of it. But you know that your Bank usually has insurance as if someone steals your debit card, and somehow these things are traceable and you can probably get your money back. Whereas in cryptocurrency like Bitcoin it is almost impossible to trace this. And you can’t even go to the police and even if you do, they can still do nothing about it.
And at the end Bitcoin is very unpredictable.
Well, I think I have covered most of the basic portion about cryptocurrencies, hope this article increased your knowledge. Also do let me know your questions in the comment