Post Menu and Details.
- What Are Cryptos and How Many Are There?
- The Investment Guide
- The Big Three in Cryptocurrency
- Are Cryptocurrencies A Good Investment?
Reading time: ~4 minutes
Since the debut of the first-ever established digital currency in the market, consumers are now offered various options to pay for their products or to conduct transactions using crypto. Despite crypto’s ups and downs in their market value, new and experienced investors became very popular among them. Not only does it gain acceptance by various organisations, but it’s also now accepted as a mode of payment to fiat currency.
Cryptocurrencies may rise in their market value, but numerous investors still see them as something that would pass by quickly. Why? Because digital currencies simply don’t generate any cash flow, and for a consumer to gain profit from crypto, someone else has to pay more for the asset than you previously did. However, despite what good things you hear about investing in cryptocurrency, it is still a highly volatile asset that is also decentralised. So, it is essential for new and experienced investors to keep the following guidelines in mind before deciding on investing and to use trustworthy crypto trading platforms, like Bitcoin Digital.
To generalise what cryptocurrency is, it is a form of payment that is mostly used as an exchange for various transactions such as services and goods. These days, there are already numerous companies that have issued their version of the digital currency, which is often called tokens, and these can be specifically traded for the services or goods that the company provides for its customers. In 2021, there are already 10,000 different cryptocurrencies that are publicly traded in the market, and the number of cryptos is still increasing. As of August 18, 2021, the total value of all cryptocurrencies combined has already reached 1.9 trillion dollars.
Cryptocurrency is a highly volatile asset to invest in, so if you ever decided to jump in on the trend, there are a few things for investors to keep in mind. First of which is the research that you need to do as there is a lot to know about blockchain technology and how the market for cryptocurrency functions while also varying all the information you have received.
Furthermore, while checking for the market value of a cryptocurrency you’ve looked up, never get influenced by the hype and drop all of your capital in a single exchange. Always start small and only invest the money that you can tolerate losing. More importantly, since all cryptocurrency exchanges require you to create an account using an email D, it’s highly advisable to create a separate one only for crypto trades and transactions, this is to avoid the risks of a hacker getting hold of your data.
With cryptocurrencies rising in market value, investors are now turning their heads into investing in digital currencies. By now, the total theoretical value of all Bitcoins is higher than that of Mastercard, and Walt Disney put together, but the first-ever established digital currency is not the only competition in the market that gives other assets a run for its money. Numerous others have surged in popularity since its debut, and every other alternative coin is already large enough to be valued in billions of dollars. The big three in cryptocurrency may be traded in large volumes any time, but their market capitalisation is what made them retain their spot in the top three.
Bitcoin is the first-ever established cryptocurrency that is currently still in circulation, and it has retained its number spot among the rest of the cryptos. However, one minute the market value of Bitcoin rises, the next thing you know, it plummets down to ridiculously low numbers. Due to Bitcoin’s high volatility, investors have been on a wild ride in the cryptocurrency market in 2021 as the prices surged around 30,000 dollars, then peaking at a little over 63,000 dollars, but suddenly plummets below 30,000 dollars when closing in the third quarter.
If you’re buying Bitcoin, you’re not buying a physical coin as it is just a digital number. But there are numerous ways on how you can collect digital coins. You buy them directly at cryptocurrency exchanges, trade them, or you mine them yourself with the use of powerful computers. However, the supply of coins is limited as there can only be 21 million of them that would ever exist, which means that if the total number of coins that have already been mined reaches that number, you won’t be able to mine any more.
Ethereum is Bitcoin’s predecessor, and it’s an open-source platform that can be utilised to create DApps, or Decentralised Applications, giving users the freedom to write their code to perform specified actions or to control its digital value. Moreover, Ethereum’s platform provides users with the capability to create a decentralised application that would serve as the consumer program, and it’s also accessible anywhere in the world if they access the internet.
Furthermore, Ethereum is now considered to be a one-of-a-kind programmable blockchain. It’s like a consumer has been given a skeleton key, and it’s modifiable – You can either layer the muscles, place the organs, tweak the bones, or put the finishing touches. By now, you must have realised that Ethereum is a multifaceted domain with various aspects that helps some technologies function. For instance, some applications act as a third party to connect one user to another based on a logic set by the programmer, and numerous centralised systems that we have today can be built as a decentralised one with the help of Ethereum.
The third on the list, behind Bitcoin and Ethereum, is Cardano or ADA. So what is ADA? To clarify the confusion, Cardano is the blockchain, while the token is called ADA, named after the mathematician Ada Lovelace. By now, people have already known cryptocurrency, and the majority have already invested in the top cryptos in the market, so why is ADA doing the rounds? Because, cheaper, newer, thus generally less valuable. However, it’s a third-generation coin, which means it has been developed to have more potential and real-world use than the first-generation such as Bitcoin.
Cryptocurrencies, as experienced investors see it, are still mere speculation, they may significantly go up in value, but they can plummet to ridiculously low numbers as well. However, despite some experienced voices pointing out to steer off from crypto, there are already numerous people that became millionaires, billionaires even, to cryptocurrency. But it still needs stability so that merchants can fully utilise the convenience cryptos provide and determine the fair price to go for.
Thank you for reading!