8 basic things to know about cryptocurrency and bitcoin - FaqLabs

Saturday, 9 December 2017

8 basic things to know about cryptocurrency and bitcoin

things to know about cryptocurrency and bitcoin

Bitcoin or cryptocurrency is the biggest investment story of the year 2017. Cryptocurrency stands for digital cash and there are many cryptocurrencies available in market; most famous being Bitcoin and etherum. 

The value of bitcoin grew way beyond anybody could imagine. Several cryptocurrencies came into existence but bitcoin remained the winner by all means. 

There have been sense of confusion, trust, future, illegality , acceptance all at once about cryptocurrency but the increase in prices have shown that the bitcoin and other cryptocurrencies are here to stay. 

Cryptocurrencies has became a global phenomenon but still remain un-understood by many. 

These virtual currencies have caught the imagination of many but have also created fears among others. Many are confused and not sure whether to go with the flow or not. Here are 8 basic things you should about cryptocurrency and bitcoin

1. How it all began
Cryptocurrency is synonym with bitcoin mostly because of the press that bitcoin has got and also the boom that we have seen in its price recently.

It has been increased manifolds and everyone is after investing in it. It all began in late 2008 when Satoshi Nakamoto, an unknown inventor of bitcoin accidentally invented the cryptocurrency. 

It was the side product of invention that has now become the internet currency gold. This peer to peer electronic cash system was invented to prevent double spending.

Its completely decentralised without any servers or any centralized authority. This system is similar to peer to peer file sharing where in there is not central authority in between. This is all Satoshi wanted to make and the Bitcoin was born. This has basically decentralized the digital cash. 

Previously also there have been attempts to create similar systems but Bitcoin took it to another level.

2. How exactly it works
things to know about cryptocurrency and bitcoin

In digital cash where there exists a centralized system there is an issue of double spending. In a decentralized system thee is no central server and hence this issue is resolved. 

It is a peer to peer system where in every peer in the network checks the transaction. In this case there has to be absolute consensus between peers. Satoshi devised the method get this consensus without any central authority. This solution actually resulted in the invention of Bitcoin or cryptocurrency.

A simple definition of cryptocurrency thus remains a limited entries in database nobody can change without fulfilling some specified conditions. 

3. Cryptocurrency Acceptance
things to know about cryptocurrency and bitcoin

Cryptocurrency is digital cash that one can use online to buy things. It is accepted almost everywhere in shopping portals or hotels. In future this s going to be widely accepted even more as the trust increases.

4. What other Cryptocurrencies exists
Cryptocurrency types

Bitcoin has remained the most accepted and famous cryptocurrency over some years now. It has grown many folds and has got much more attention than any other cryptocurrency. 

Currently there are different type of cryptocurrencies available. Apart from bitcoin there are lots of other cryptocurrencies that exist.
Ethereum : This is another famous cryptocurrency that has caught the attention. This was invented by vitalik buterin. It is flexible and a perfect instrument for blockchain applications.  Ripple, monero, NXT are some of the other cryptocurrencies that are growing.

5. Legality of Cryptocurrency
 things to know about cryptocurrency and bitcoin

Cryptocurrencies are digital cash that remain secure from political influence. It promises to remain safe and increase its value over time. 

They are fast and easy to use with worldwide scope. They are however private without any centralized system of authority. 

They remain anonymous and may serve a means of payment for black markets and other economic activity. Few countries do not allow cryptocurrencies and are banned.

Legality of cryptocurrencies has been the hot topic specially because there is no centralised body that governs this. It is always advisable to follow your countries regulations before  jumping into the buying or selling of cryptocurrencies.

6. Future Possibilities
cryptocurrency and bitcoin future

With the kind of increase in prices that we have seen in bitcoin an average person would no longer be able to buy a single to unit of bitcoin. 

As the global market inflate and remain recession prone the world will move towards bitcoin and try to escape the world market turmoil. Bitcoin is definitely the way out and cryptocurrency as whole will never go away. 

It is going to grow in its use and the acceptance will continue to mature. They are here to stay and to change the world. This in fact has already began happening. People all over the world are buying or investing in bitcoin and hence the prices have soared. 

Institutional investors too have been buying into bitcoins and other cryptocurrencies. The market of cryptocurrencies is very fast and wild, everyday a new cryptocurrency is born.Some stay, grow while other die a natural death.

7. Is it safe to invest
cryptocurrency and bitcoin is it safe

With technology you also have a risk of thieves. While the bitcoin may be legitimate there are bad factors that could warn you of risk. Hacking and tail of previous transaction chain could be of risk. But with time however we will have more secure and trustworthy system for sure. 

Also the volatility involved is another factor for general public to buy it. People like warren buffet, JPMorgan Chase CEO have however commented that its not a good thing to invest in bitcoin and those investing in it will face the music one day. Warren buffet also called it "mirage"

8. How to buy Bitcoin and other cryptocurrencies
There are several ways to buy bitcoin. One way is to buy through bitcoin wallet. Most popular among these wallets is coinbase.

Note: Investments should be done with great care and should not be done solely on the basis of other peoples personal views.The view here in on cryptocurrecnies are personal and any investments should be discussed with personal finance advisers and should not be taken only on the basis of the views expressed here in.

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