Cryptocurrrency For Beginners

Introduction

Cryptocurrencies are virtual currencies that use Cryptography (the art of writing codes) for security making it impossible to duplicate or counterfeit. Unlike the Stock Markets, Cryptos aren’t backed by Companies and Firms. Instead, the prices of them completely depend on the laws of demand and supply. They have been around since decades but have come under the popularity radar quite recently, primarily due to the Dogecoin craze engineered by Elon Musk along with the abnormal fluctuations of the Bitcoin.

What are Cryptocurrencies?

Cryptocurrencies are digitally mined tokens that are completely decentralized. In layman terms, the government has no regulation over these currencies and the value of which is completely dependent upon the users and regulators. They are digitally mined – implying that in order to acquire one, a person has to either compute complex mathematical equations or spend money to obtain one, in the form of Crypto Trading. Cryptos can be perceived as a form of Digital Cash. Several apps such as CoinDCX, WazirX, Coin Switch facilitate the trade of cryptocurrencies where users, just like with stocks, can make profits out of price fluctuations

Why do Cryptocurrencies have value?

These currencies are not backed by the government yet have a value because of their

• Divisibility

• Scarcity

• Non-Counterfeitability

• Durability

• Utility

If a Crypto is accepted by a few companies as a means of payment, then in a way it substitutes the role of physical money and hence, its price rises. Similarly, if a token can attract users, it will rise in value; This was the reason the Cryptocurrency Dogecoin had an exponential growth spurt since there were deliberate efforts to bring attention to that token.

The popular Cryptocurrencies in the Market

Bitcoin as managed to emerge itself as one of the most useful and trusted Cryptos in the world and as set a pathway for other currencies to emerge and flourish. The popularity of a Cryptocurrency mainly depends on its Market Attraction, Return on Investment and Profit Percentage along with Face Value. Some renowned Cryptocurrencies are

• Ethereum (ETH)

• Cardano (ADA)

• Ripple (XRP)

• Matic Network (MATIC)

• Polkadot (DOT)

• LiteCoin (LTC)

• Binance Coin (BNB)

Why should one get into the Crypto Market?

Cryptocurrencies are quite clearly a risky investment and one should have a sound knowledge before getting involved in the same. An exclusive feature of Cryptocurrencies is that unlike fiat money, Cryptos have a limited market cap which will make it impossible for the government to dilute their value by inflation. Moreover, Cryptocurrencies are the definition of ‘Big Risk Big Rewards’ and with the right knowledge, one can profit manifolds.

Conclusion

Cryptocurrencies have been highly regarded as the ‘Successor of the Dollar’ due to its decentralization, quick and efficient medium of exchange and ability to work only on internet, without any financial institution such as a bank. The more companies are willing to accept cryptos as forms of payment, the greater the benefit for the holder since Cryptocurrencies have a high chance for playing the role of money, but in a much more transparent and efficient way. Cryptos are indeed the future.