WHAT IS CRYPTOCURRENCY?
A Starter's Introduction Guide to Cryptocurrencies
What is Cryptocurrency?
Cryptocurrency is a type of digital currency. Cryptocurrency is designed to work as a payment system much like credit card and Paypal. However, there is one major difference between cryptocurrency and the traditional payment system - Decentralisation. In traditional payment system, we rely on a trusted central authority (such as bank) to keep record of our account balances and transaction records. In such system, the authority is in complete control of our funds and details. Besides that, international transactions made through banks are typically slow and expensive.
Decentralisation eliminates the central authority in the system, putting everyone joining the cryptocurrency network in charge on verifying all the cryptocurrency transactions. Computers working on verifying the transactions are known as miners. Miners check every transactions, making sure that each transaction is legitimate and verify them by solving difficult computational puzzle. Once the transactions are verified, transactions will be attached to the blockchain based on the network consensus and the transaction records could never be modified again. Just think of blockchain as a secured record keeper, records added to blockchain could hardly be modified or removed.
Cryptocurrency is thus more transparent and allows faster and cheaper international transactions. This is because transactions can be made directly between the sender and receiver without any intermediaries.
What can I do with Cryptocurrency?
Buy things like a pizza.
Cryptocurrency such as Bitcoin has been widely accepted as a form of payment from a growing list of retailers and merchants today. You could book your flight and hotel tickets while ordering a Hawaiian Chicken flavoured pizza with Bitcoin today. * Although other cryptocurrencies such as Ethereum and Dash are not so widely accepted as Bitcoin yet, we believe that it will change as cryptocurrencies become more adopted. Below is a short list of companies and services which accepted Bitcoin as payment *:
* Services only available in certain countries.
Till date, Bitcoin had the highest value of over $19,000, from $0.06 in just over 8 years time. It has thus spurs interests among many investors due to its high return investment value. More and more cryptocurrencies have also been introduced since the blooming of Bitcoin, with over 900 coins circulating the market at the time of writing. Some investors would thus buy cryptocurrencies at lower price and sell them when the value increased. Ever growing cryptocurrencies and its values are also attracting more investors to trade cryptocurrencies as an investment.
With Bitcoin (BTC) still being dominant in the market, Bitcoin is famously traded against other cryptocurrencies such as Ethereum (ETH), which the trading pair is represented as BTC/ETH. Cryptocurrencies could be traded on any major Exchanges. While some Exchange only support Crypto-Crypto trading, Cointify Exchange supports Crypto-Fiat trading. On Cointify, you will be able to buy BTC and ETH with fiat currency such as USD. Kindly refer to the Beginner's Guide on [ Get Started with Cointify Exchange ] and start your investment.
Cryptocurrency network depends on the process known as mining to verify each transaction, where each miner would need to solve computational difficult puzzles. In return, the network rewards miners who solved the puzzles with cryptocurrency such as Bitcoin and transaction fees. Since everyone could join the network as a miner, more people have seen mining as an investment and tried to mine with home PC and even high specification laptop back in the days.
However, the network has been programmed as if the number of miners increased, the difficulty of the
puzzles would also increased as well. As the number of miners have since increased, an investor would need to invest in GPU and ASIC
mining rigs which proved to be efficient in mining cryptocurrencies today. Each of these rigs could easily cost a few thousands dollar.
Investors would need to determine if the ROI in mining is worth their investment. Some of the common mineable coins include:
- Bitcoin Cash
Since mining rigs are in high demand, investors could choose to invest in the mining rigs and be a reseller than investing in the mining process itself.
How to get Bitcoin and Ethereum?
Due to its prominence, Bitcoin could be easily acquired through several ways. One of the most obvious
way is for somebody to send you Bitcoin. Sending can be made easily between two cryptocurrency addresses (think of cryptocurrency
address as your bank account). The sender would just need to insert the recipient's address, the amount to be sent and off it goes.
Besides that, some cryptocurrencies could also be purchased on Bitcoin ATMs available on the markets today. * There are over 2600
Bitcoin ATMs spread across 65 countries at the time of writing.
* Services only available in certain countries.
The other prominent way to acquire Bitcoin and Ethereum is through Exchange. While some Exchanges only accept the exchange of crypto-crypto, Cointify accepts crypto-fiat in which investors could purchased cryptocurrencies with fiat currency such as USD. Register an account and find out how easily you could purchase your Bitcoin or Ethereum through Cointify today!
How to store Bitcoin and Ethereum?
Just like how you would store your money, cryptocurrencies are stored in digital wallets. When you created an account on Cointify, wallet will be created to store your cryptocurrency. Digital wallet stores the essential private key required to send and receive cryptocurrency.
Is Bitcoin promising?
Although price of cryptocurrencies could fluctuate a lot and negative news could be seen circulating around, we believe that if applied and used correctly, cryptocurrency and blockchain technology are promising.
As a matter of facts, more and more countries and companies have taken on their own cryptocurrency and blockchain ventures today. Venezuela has launched their own cryptocurrency known as Petro, claimed to be backed by the country's oil and mineral reserve; Dubai aims to launch their state own cryptocurrency known as emCash; Imaging expert Kodak has launched KodakOne blockchain platform and KodakCoin cryptocurrency; Low cost airline Airasia also planned to launch cryptocurrency BigCoin, which could be used to pay for flight tickets and in-flight services.
As Bitcoin and blockchain technology were only introduced in 2009, the technologies are still in the early stages. There is a huge space and potential for cryptocurrency and blockchain to gain widespread acceptance. While we are here, Cointify aims to accelerate the widespread acceptance of cryptocurrencies.