The world has gone through a financial upheaval and the central banks of the world have printed trillions of dollars, euros, pounds and yen to reinvigorate their economies. Some people think we’re in for a dollar collapse, which would be bad news for many people. But there’s a way to protect yourself from this happening.
Investors are turning to cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH). If you’re new to digital currencies, these tips will help you understand more about them – and how they could impact your finances.
What is cryptocurrency? Digital currencies are internet-based money that use cryptography – complicated math problems used to create secure communication – to produce coins and verify transactions. These currencies aren’t managed by a central bank or other authority. They’re backed by blockchain technology, which is a public ledger of transactions that everyone can see and access.
Why would I want cryptocurrency? Cryptocurrencies offer several benefits over fiat currency (money issued by a government). First, they’re decentralized. This means no government or bank controls them, so investors may feel more secure that their money isn’t at risk if something happens in the economy or political sphere. Second, cryptocurrencies are anonymous,
The surge in bitcoin’s value is a boon for Coinbase, an exchange where crytpocoins can be bought, sold and stored in wallets. Coinbase added more than 100,000 users Nov. 2 in one day alone, and today the service boasts more than 6.3 million users.
The price of Bitcoin has been buoyed by increased interest from places like South Korea and Japan, where the digital currency has been deemed a legal means of exchange. In South Korea, the government has taken steps to regulate crypto-currency trading with banks. And Japan passed a law in April that recognizes bitcoin as a legitimate method of payment.
This has helped lead to a big bitcoin rally this year — the digital currency is up more than 500% since January.
The world of crypto currency is moving really fast. Over the past 5 years Bitcoin outperform any other investment like gold, stock market or real estate. Over the past years hundreds of new crypto currencies came on the market. Most of them are just copy cat or only have a few features that make them different.
But there are some new cryptocurrencies that promise to revolutionize the world of digital currencies and blockchain technology. Let’s take a look at these new crypto currencies that may change the world in future!
Bitcoin was the first cryptocurrency based on blockchain technology. It was created in 2009 by Satoshi Nakamoto, but it went online in early 2010. Since then many more crypto currencies have been created. Most of them are nothing more than attempts to reach investors and quickly make money, but a lot of them promise playgrounds to test innovations in cryptocurrency-technology.
Here is a list of some amazing cryptocurrencies:
Bitcoin is a new, digital currency that is being used all over the world. The currency can be used to buy merchandise anonymously. It’s been described as “a purely peer-to-peer version of electronic cash” (Bitcoin, 2015). Bitcoins are not printed, like dollars or euros – they’re produced by people using software that solves mathematical problems. Bitcoin was invented in 2009 by someone who uses the pseudonym Satoshi Nakamoto. The software is open source, meaning anyone can review and modify it (Bitcoin, 2015).
Bitcoin is a cryptocurrency; a digital asset designed to work as a medium of exchange. This means that it uses cryptography to secure transactions, control the creation of new units, and verify the transfer of assets (McKinsey Global Institute, 2017). Over time, Bitcoin has gained popularity because of its decentralized nature. The system doesn’t depend on any central authority to regulate or issue the currency (McKinsey Global Institute, 2017). As more people have begun using Bitcoin, the value has increased substantially; climbing from approximately $0.04 per bitcoin in 2011 to nearly $3,000 per bitcoin at the end of 2017 (MarketWatch, 2017).
Will bitcoin survive? Is it a scam? Will it ever be as widely used as the dollar or gold? Should you buy some bitcoin stocks? These are all questions that only the future can answer.
What’s almost certain, though, is that the blockchain technology behind bitcoin is here to stay. But what is blockchain technology? How does it work and why is it important?
In a nutshell, blockchain provides a way for untrusted parties to come to agreement on the state of a database without using a middleman. That may seem counterintuitive, so let’s take a look at how it works. (For more detail on how this works, see “What Is Blockchain Technology?” below.)
A block in the chain refers to a set of transactions. So if we have ten transactions submitted to the network at any given time, they could all be included in one block (assuming there’s enough room). But then only one block would be updated in the ledger at that time. Ten minutes later, another block would be added to the ledger and include those ten transactions plus new ones.
The blockchain is always growing and is completely open to anyone. Each new block generated must be verified by each user on the market,
Stock prices are simply the price of a share of a particular stock. They are driven by supply and demand. If more people want to buy a stock (demand) than sell it (supply), then the price moves up. Conversely, if more people wanted to sell a stock than buy it, there would be greater supply than demand, and the price would fall. Understanding what drives supply and demand is the key to investing.
Bitcoin was invented in 2008 by Satoshi Nakamoto, an unknown programmer or team of programmers using that name as a pseudonym. It has its own special features and characteristics. One of them is that it is not controlled by any central authority like a government or corporation. All transactions are made between individual users directly, without an intermediary. These transactions are verified by network nodes through cryptography and recorded in a public distributed ledger called the “blockchain”.
Another interesting feature is that Bitcoin cannot be artificially inflated like Fiat currency can be, because there is a limited amount of Bitcoins that can ever exist (21 million). This makes it attractive as an investment vehicle, especially in countries that experience high levels of inflation such as Mexico or Argentina.
There are many other cryptocurrencies besides Bitcoin, though Bitcoin remains far and away the most popular one with the largest
Bitcoin began to take off, and people were asking me about it. (“Is bitcoin going to change the world?”) I didn’t have a good answer. The best I came up with was “Probably not, but there is a small chance that it will be important someday.”
Not knowing much about bitcoin, I was initially skeptical when someone suggested that we buy some. But as time went by and its price kept rising, my skepticism turned into interest. It seemed like just the kind of thing our fund should own. If a lot of people are speculating on it, the price can rise far above its fundamental value for a long time. And if it ever becomes widely accepted as a currency, its value will skyrocket. (And if it doesn’t, we can sell it and make a large profit.)
So in June 2013 we bought what seemed at the time a lot of bitcoin: about $20 million worth at $120 per coin. Almost no one outside crypto-currency circles had heard of bitcoin then, so our purchase attracted relatively little attention. At least, that is how it seems now: searching news archives from around that time shows only six stories mentioning us buying bitcoin and two articles mentioning us selling gold