7 things you should know about Cryptocurrency

Probably you heard about Bitcoin by now. It was the first cryptocurrency to go mainstream, but others are growing in popularity. There are more than more cryptocurrency than paper-based cryptocurrency right now and more are developed every day. To help understand, I will answer 7 questions about cryptocurrency you should know.  

1. What is cryptocurrency?

Cryptocurrency is a digital currency that is secured by cryptography. In this context, cryptography means that is it nearly impossible to counterfeit or double-spend. So, in other words, cryptocurrency is a secure virtual currency.

2. How many cryptocurrencies are there?

According to CoinMarketCap, there are 6,955 total numbers of cryptocurrencies. There are more cryptocurrencies than the actual paper base currency. The United Nations recognizes 180 currencies are used in 195 countries across the world. So, the existing number of cryptocurrencies should tell you something about it.

3. Why are cryptocurrencies so popular?

There are many reasons, and here are some of the most popular:

• Cryptocurrencies are decentralized, unlike “traditional” currencies. That means no government controls or manipulates the value of cryptocurrencies.
• Most people that invest in cryptocurrency like it because they are going up in value and there is no interest in the currency.
• Easier to transfer funds directly between two parties without the need for a trusted third party like a bank.

Related article: What you should know about digital inheritance

4. Are cryptocurrencies a good investment?

The first thing you should know about investing in cryptocurrency is that it is extremely volatile. Prices are rapidly moving up and down. If you buy at the wrong time, you could lose a good deal of money. However, If Bitcoin and Ethereum, the two most valuable cryptocurrency in the market become a form of cash, then investors who buy these cryptos today will likely be richly rewarded in the years ahead.

5. How do I buy cryptocurrency?

To buy a cryptocurrency, the first thing you need is a wallet. A Wallet in this case is an online app that can hold your cryptocurrencies. There two trusted wallets I used that you can use to buy your cryptocurrencies, Coinbase and Robinhood (Robinhood crypto is not available in all states, double-check before you download, but Coinbase is my go-to).

Once you have it download on your phone, you can create an account, and then you can transfer real money (dollar) to buy Bitcoin, Ethereum, or any other crypto you would like to invest in.

6. What tis the practical approach to invest in cryptocurrency?

When you invest in cryptocurrency is no different buy stocks, you should diversify, which means putting money in different cryptocurrencies, especially those well-known such as bitcoin, Ethereum, Ripple, Litecoin, Bitcoin cash and etc.

Read also: All you need to know about bitcoin

7. How can I protect myself?

Last, since we are talking about money, it is important to know how to protect your digital currency.  There are more than 400 different cryptocurrencies and before you buy google really quick to check the legitimacy of the crypto you want to buy or invest in and avoid anything that looks suspicious to you.

I hope after reading this blog post, you understood a basic about cryptocurrency. it’s not everything about cryptocurrency, there is a lot more but I prepare this basic jus to help you understand what this is about.

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See you soon!