Cryptocurrencies are rapidly gaining recognition globally of recent. In 2016 it was estimated that there was somewhere in the region of 15 million bitcoin wallets on top of the millions of other wallets people hold for the different currencies available. The majority of these are held in accounts with major providers such as Coinbase or Multibit
Like most people, in 2012 you had probably never actually heard of Cryptocurrencies and the likes of Bitcoin. So what actually is it? And why do we keep hearing about all the people that may have made x amount… (which is usually a huge number)!
Cryptocurrencies – are they a form of digital cash?
That’s exactly what it is! Cryptocurrencies are a complete digital asset, which you are unable to take out as physical “coins” or assets. It is a type of peer to peer digital cash system which is decentralised (no central authority or third party involved) unlike physical currencies today.
So where do they come from?
Cryptocurrencies are created using a method called mining. They are created through a series of computer equations called algorithm and released in a controlled manner to avoid inflation and de-valuing the currency.
How do I get them?
For the most common coin such as Bitcoin and Ethereum, setting up a wallet on sites such as Coinbase is the common way to do this. This allows you to add your physical money into your account and trade them for the digital currency of your choice. Just like going into a currency exchange when you are going on holiday.
What happens once I hold a cyrptocurrency?
Currently Cryptocurrencies aren’t widely accepted in your everyday shops, however more major players are starting to accept them in diverse sectors. A quick search on any search engine should be able to give you guidance on who actually accepts them, however don’t forget to check with them directly first.
There are major plans for Cryptocurrencies to be accepted by retailers, online, banks etc however most of the hype currently, is that they are being seen as an investment, to trade, or a way to make money. The fluctuations in price and the growth in value for the likes of Bitcoin make it attractable to any investor who can fork out a large or small initial investment.
However, please remember like everything, no investment is guaranteed to make you money. There are always risks involved. Be wise, this is not a get rich quick scheme! This is a genuine currency and like anything, different events impact the value of it!
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We are not investment or financial advisors and are here to provide news and our opinions. Please be fully informed regarding the risks and costs associated with trading the financial markets and the Cryptocurrency market, it is one of the riskiest investment forms possible.