Hello, my name is @NakamotoBch and I am a cryptocurrency enthusiast.
I’ve been following Bitcoin and Blockchain technology for over a decade. If you are a long time follower like me, then you know that cryptocurrency in general has had its ups and downs.
I am writing this blog post because I feel that many people do not understand the true value of cryptocurrency. It is also important to understand that cryptocurrency is very different than just investing in stocks.
While the recent price and volatility in Bitcoin, Ethereum, Bitcoin Cash and other cryptocurrencies has caused concern, it is important to understand what is really happening in the cryptocurrency world.
There are several important things people need to understand about cryptocurrency. First, cryptocurrency is not just for criminals. Second, cryptocurrency is not going away. Third, the true value of cryptocurrency is that it provides more privacy and less financial censorship.
While Bitcoin is the most popular cryptocurrency, there are many other cryptocurrencies that exist.
What is CryptoCurrency?
What is a Cryptocurrency and where can you find it? A good question. But the answer is a little more complicated and complex. We can not answer that question with a very concise and very clear definition about where a currency is coming from (where does it come from) or where it goes to (where is it going and what are the future plans of any coin).
Let's talk about that. Before talking about it let's try and understand what cryptocurrency is? Cryptocurrency is an innovative technology that is the underlying basis for this digital economy. Cryptocurrency is an asset or currency that is secured and backed by decentralized trustless technology and distributed ledger(s) on an open community network where the tokens are issued and managed by peer-to-peer decentralized mechanisms managed by crypto-currencies.
Cryptocurrency is the only technology that allows individuals or businesses to be in complete control over their own money. A currency has no owners, a currency is a medium for the exchange of products and services between people.
Cryptocurrency is a way to transfer value across the Internet and avoid costly, outdated, and inefficient money exchanges, that are costly, costly, and extremely time-consuming that involve lots of middlemen and use paper money as a settlement method.
Cryptocurrency is a currency issued on public and decentralized ledgers which means there is no central authority, the system is governed by the market itself and is not governed by any country.
Cryptocurrency is the only way to have a true, decentralized asset-backed by true scarcity which is what we are looking for when we are looking to invest in an investment fund, that is looking to buy a security with this cryptocurrency, the underlying asset. To learn How decentralized Cryptocurrency works check this article posted by @Stuart here .
While it is quite exciting to invest in this new technology we understand that we are looking at the long way since we have to understand and understand the underlying technology.
Why Bitcoin and other cryptocurrencies are so volatile
Over the last few years, there has been an uptick in the overall growth of crypto assets. The total crypto market capitalization has more than doubled in value (from under 1 trillion to over 2 trillion over a matter of just 7 years) while the total number of total crypto outstanding has tripled.
While we can attribute these growths in our respective markets, the true drivers of the growth (for Bitcoin) are the various side products of this trend that are still in the process of forming:
Better understanding of what it takes to create a profitable company, and what the competition is doing.
There is a growing demand for privacy, decentralization, and independence in our individual lives, so we are slowly gravitating toward ‘smart’ technologies that are built upon new models of decentralized infrastructure.
There are increasing efforts to democratize the use of data and the ways in which companies and individuals are allowed to access, curate, and apply that data for the purpose of social good, etc.
There is growing skepticism toward any central authorities or corporate structures, with some pundits calling for a “soul” to be restored. As such, people recognize that we have more in common with each other, than we do with our respective counterparts from the global marketplace.
These are not coincidences. They are reflections of the emerging technological trends driving our current state of human existence. These days it no longer matters what the “hype” is about you can’t afford to not have access to it.
As such, there has been an emerging movement away from monetary systems that are based around ‘trust’ and away from money systems that are based around physical tokens that are transferred over digital platforms
What is the value of a cryptocurrency?
In the world of currencies, most of us would have only heard about the different currencies like the Indian Rupee and the dollar. However, as people are becoming more familiar with different currencies, it has become harder to define the currency.
With the advent and introduction of Bitcoin, people have started looking at it differently. The use of Bitcoin and other cryptocurrencies to make payments has created a lot of confusion, as a majority of people have no idea about what the cryptocurrency is, where it is headed, and what its value.
People have been asking me many times, “What is a cryptocurrency, and what is its value?”
The current value of Bitcoin is at $39,000 which means the current cryptocurrency market cap is equivalent to approximately $683.5 billion in value.
When we talk about ‘value’, we will understand, for example, on a stock market of a company that the value (or market cap) is the same as the price of the stock in terms of dollars.
However, for cryptocurrencies, a number of different things come into being. Cryptocurrencies like Bitcoin can be considered an asset, or an investment, or a currency, and depending on the people in terms of what they will use to buy using cryptocurrencies, how much will they charge to use in terms of transaction fees.
Cryptocurrencies also are not actual coin or coin-like coins, because there is no physical piece of metal or paper that represents a bitcoin or other crypto-currency. No matter how many Bitcoins, LTC, or any other crypto coins are created, they can all exist only on the blockchain which represents an open record.
Conclusion
Now you see why cryptocurrencies matter more than other forms of money. While that may sound bad or hard to understand, cryptocurrency has many benefits that are worth knowing. There are few things in life that people are so lucky to be able to enjoy, like using technology without using any kind of manual labor, or being able to spend more money in a short period of time, as well as enjoying the benefits of being completely anonymous.