Cryptocurrency

Cryptocurrency

Cryptocurrency has become the new fad in investment in this digital currency era. Do you know unlike traditional currency, cryptos are not tangible? Yes, they can’t be touched or kept in your pocket for real as they are totally virtual. Cryptos are protected with encryption and use an online ledger so that it is almost impossible to counterfeit or double-spend this digital money. One can use this digital money to buy goods and services and do trades online.

Altcoins is another term for cryptocurrencies, a short for alternative coins. New cryptocurrency units often enter online circulation through a technological process called ‘blockchain’ that requires the participation of volunteers from all over the world using their computers. This process is decentralised and the transactions get validated and recorded across various computers ensuring the process to be manageable and secured. The act of confirming, encrypting, and protecting transactions in each block is known as "mining".

Computer systems that are available for use in particular cryptocurrency networks are called Miners. These miners hold the blockchain nexus by maintaining a ledger of all previous and current network transactions. Bitcoin is the world’s first and the most popular cryptocurrency. Other popular altcoins are Ethereum, Ripple, Dash, Litecoin, Dogecoin, and zCash.

Compared to traditional currency or fiat currencies, cryptos have distinctive features that have helped them in their wide popularity. These include an unregulated "market" of the currency, transaction which is fast and of less cost, an algorithm that determines the limited supply of currency, and a crypto transaction once completed is permanent and irreversible. However, fancy the currency and transaction may sound, it has some risk elements too. The cryptocurrency exchange is vulnerable to the market crash and security breaches. Tight competition and prevalent scams in the market also add to the risk factor in crypto investments. It is important to remember that though every cryptocurrency is a digital currency, not all digital currencies are cryptos. An observed aspect in the crypto market is that investors are most concerned about the potential of a cryptocurrency's price rise in the future than whether or not they can use cryptocurrencies to buy products and services at the moment. This has made crypto more like an investment scheme than a currency transaction.