The age of technology has brought incredible innovations to our life especially after the Millenium. An important example of this age is the use of cryptocurrency. You may ask “What is cryptocurrency?”, and find that it’s a digital currency. Also known as crypto, cryptocurrency replaces fiat currencies like Euro and Dollar.
Intervention over cryptocurrency is easier because it’s not under governments’ control. It’s completely digital, and it exists only on the internet. So, they’re not produced as banknotes or coins.
In this guide to cryptocurrency, you’ll find the very basics about this digital currency. These are the types, advantages, and buying processes of cryptocurrencies.
Types of Cryptocurrency
Over the years, new cryptocurrencies started to appear. Among them, Bitcoin (BTC) is the most famous of them all. It’s a secure and peer-to-peer transaction cryptocurrency. Following Bitcoin, Litecoin (LTC) is the second most famous cryptocurrency. Besides BTC and LTC, Ethereum is another popular crypto as well. It’s especially favored
by blockchain investors.
Other well-known cryptocurrencies are:
- Tether (USDT)
- Cardano (ADA)
- Bitcoin Cash (BCH)
- Stellar (XLM)
- Dogecoin (DOGE), and
- Polkadot (DOT).
How Does Crypto Work?
You may rightly ask “How does crypto work?”. Well, blockchain is playing a key part in this. Blockchain technology is something that most cryptos are built on. For example, when a crypto transaction is made, a new block is produced. In this way, this transaction is written on the block. When a new block is created, it’s linked to the older block, and this forms the chain.
Blockchain is protected by cryptography, and alteration of blockchain is quite difficult. It’s the blockchain technology that makes it possible for cryptocurrency to exist as an alternative.
What About Security?
The question of cryptocurrency for beginners comes with safety and security, for sure. Luckily, cryptocurrency has ensured the users in terms of safety issues. As noted above, blockchain is encrypted by cryptography. In this way, it’s even safer than a transaction you’ve done through a bank. So, they are not easy to hack or breach.
Legality
Cryptocurrency is not legal tender for governments. Furthermore, some countries have explicitly banned crypto use. These countries include Qatar, Egypt, China, Algeria, and Nepal. On the other hand, some countries have confirmed the use of crypto. These countries include Germany, Denmark, Mexico, Spain, Iceland, Japan, and France. In these countries, you can make Bitcoin transactions. Even certain regulations exist for that matter.
Advantages of Cryptocurrency
In this guide on cryptocurrency for beginners, you can find out some advantages you can enjoy through cryptocurrency.
- Transactions of cryptocurrency are more secure than a bank. You can even make your experience more secure through some further steps
- Cryptocurrency is not a thing that can be influenced by inflation, and it has a fixed value
- It’s not under the control of a certain entity or institution. So, no possibility of monopoly
- Crypto transactions do not require much time and money.
How To Buy Cryptocurrency
There are four main steps to buying a cryptocurrency for beginners.
The first step is to choose a cryptocurrency trading service. You can manage your crypto coins through cryptocurrency exchanges, brokerages, or payment services like dash payments. Cryptocurrency exchanges, however, are the most advised option for beginners. They are both safe and user-friendly.
The next step is to submit documents like a passport for verification of your exchange. Then, you’ll link a payment option such as credit/debit cards or a bank account.
The third step includes the purchase of crypto. At the final step, cryptocurrency and Bitcoin wallets outside your exchange will make your experience safer. In addition, they guarantee that you are the only one that has control over the personal key for your account.
So, you’re at the end of the cryptocurrency for beginners guide. As you’ve also seen, it attracts users with security and increasing value, as well as no influence from inflation.
