What is a cryptocurrency?

Okay, so what is a cryptocurrency? The simplest explanation is that cryptocurrencies are forms of digital money that allow you to shop online. Unlike regular currencies, they live only on the Internet and are not supported or controlled by banks and governments. This has advantages as well as disadvantages, which we will talk more about later. Cryptocurrencies are decentralized and managed by a computer network instead of a single person or company. The money you own is stored in a digital wallet that you keep on the cloud or offline on your computer and you can send it to someone via a computer or mobile device such as a smartphone. Each transaction is recorded in a so-called blockchain that is publicly available to all currency owners.

What is mining? Cryptocurrencies are generated by mining. Mining is done by computers trying to solve a complex mathematical puzzle known as a hash. People around the world are competing to be the first to solve the hash, and the winner gets a certain amount of cryptocurrency to be mined. The process requires special hardware that will work non-stop, and even if you have a computer with a fast GPU, it probably won't be worth the time to mine - these algorithms simply require the enormous power of your graphics (you'll notice the plural). However, mining is not the only way to obtain cryptocurrencies. The easiest way is to buy them using your local currency in online markets, where you can also sell them to other users. As with gold stocks, for example, the value of a cryptocurrency is determined by purchase and demand. The most expensive is Bitcoin, which costs about $ 10,699 at the time of writing. Its price has increased dramatically over the years. When it was first introduced, one you could get for just a few cents. Eh, to give me back my time.

The biggest cryptocurrencies you need to know about Bitcoin is the largest and most well-known cryptocurrency with millions of users around the world.

It was founded by Satoshi Nakamoto in 2009. In addition to bitcoin, there are over 1000 cryptocurrencies, some worth mentioning are Ethereum, Ripple, Bitcoin Cash, Litecoin, Dash, Neo, Cardano and many others. As you can see, bitcoin is ahead of the competition and will probably remain the most used and important cryptocurrency in the world. Cryptocurrencies are here to stay, and it will certainly be so for a while. Although some less could die, larger market players like Bitcoin and Ethereum will survive for a longer period. Cryptocurrencies can be quite volatile, as their value can increase or decrease by hundreds of dollars in one day. They not only serve as a means of payment, but can also be used for large investments. The value of Bitcoin, for example, has been steadily increasing since its inception. However, as we said, cryptocurrencies are quite unstable because their value varies greatly, even on a daily basis. You could potentially either gain or lose a lot of money in a short period of time. The risk and potential rewards are huge.

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