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What Are Cryptocurrency And How To Invest In Them?

FeaturedVid Jun 14

Cryptocurrency is digital money that may be used to purchase goods and services, but it is secured by an online ledger and powerful encryption. The majority of activity in these unregulated currencies is for-profit trading, with speculators sending values high at times. The technology on which cryptocurrencies function is known as a blockchain. Blockchain is a distributed ledger system that handles and records transactions across numerous computers. 

Many organisations have launched their own cryptocurrencies, that are reffrered to as tokens and can be exchanged for services or goods that the organisation offers. As per CoinMarketCap.com, more than ten thousand crypto based currencies are traded openly. And they continue to grow in popularity, with initial coin offerings, or ICOs, being used to raise funds.

You can buy cryptocurrencies through cryptocurrency exchanges like Coinbase, and online brokers like Robinhood or eToro. You also need  a cryptocurrency wallet to store the cryptocurrencies that you buy. However some of the platforms like Coinbase functions are both trader and wallet.

Some of the popular cryptocurrencies are Bitcoin, Etherium, Tether, Biance, Dogecoin, etc.

However, before you buy cryptocurrencies, you should know that the value of cryptocurrency is highly volatile and based on speculation. Unlike paper currency which are in use currently, the value of which is backed by gold and forex reserves, and their value increases if the economy of a country improves; the value of cryptocurrencies increase or decrease merely on the basis of speculation by those who trade in them. For the same reason, some countries have banned cryptocurrencies. However in many countries they are totally legal and some countries are even planning to launch their own cryptocurrencies. So while there is no problem if you want to trade these currencies, you need to move very carefully and with full knowledge of what you would be doing.


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