What Is Cryptocurrency?

Our basic guide to cryptocurrency

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Here (below) you will find websites that explain what cryptocurrency is and often include helpful guides, links, and videos

Here (below) you will find websites that explain what cryptocurrency is and often include helpful guides, links, and videos

What is cryptocurrency and bitcoin?

Cryptocurrency, in simplified terms, refers to a form of digital currency that is securely stored in a digital wallet. It operates in a decentralized manner, which means that transactions take place directly between parties without the need for intermediaries. This digital currency can be used for a variety of purposes, including making purchases, accessing services, or even as an investment opportunity.With a staggering number of over 23,000 digital coins and tokens in existence, Bitcoin emerges as the most widely recognized and renowned cryptocurrency.

Cryptocurrency popularity

Bitcoin, the pioneering cryptocurrency, made its debut in 2009. However, during its early days, it was valued at a mere fraction of a cent. It wasn’t until July 2010 that Bitcoin experienced a significant surge, jumping from $0.0008 to $0.08 per coin. Fast forward to the latter part of 2017, and Bitcoin nearly touched the staggering price of $20,000 per coin. This period, often referred to as the “Bitcoin mania,” was a defining moment for digital currency, capturing widespread attention and sparking interest in the concept of virtual money.

Although the frenzy surrounding Bitcoin in 2017 and early 2018 was short-lived, it undeniably played a pivotal role in popularizing the idea of digital currencies.

In late 2021, Bitcoin achieved a remarkable milestone, soaring to an astounding $66,000 per coin. This unprecedented surge reaffirmed Bitcoin’s position as a force to be reckoned with in the financial world.

During the 2017 mania, alternative cryptocurrencies, commonly known as altcoins, also gained significant recognition. Ethereum, Litecoin, Ripple, and several other altcoins emerged as household names among investors, further diversifying the cryptocurrency landscape.

What makes Bitcoin and a specific group of altcoins popular choices as forms of currency?

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Fast

Cryptocurrency transactions are fast and with certain altcoins literally instant! You can send some cryptocurrency tokens in less than a few seconds to any mobile phone anywhere in the world. Get paid in seconds.

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Irreversible

Once you have sent a bitcoin payment, you can not reverse that payment later on like you can with some wire transfers or credit card payments. This helps e-commerce stores elimate chargebacks.
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Secure

All cryptocurrencies run on a blockchain. Short of a quantum computer, it is impossible to hack bitcoin. The nature of the blockchain is to be decentralized and so make it impossible to hack one central point.

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Decentralised

No entity owns Bitcoin and this makes it impossible to close it down. There is no owner or company.

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Dark or privacy coins

There are a few cryptocurrency coins and tokens that are much more anonymous than Bitcoin and these are much harder to track and trace.

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Global

All you need is a digital wallet and cryptocurrency can be sent to any mobile phone anywhere in the world.

5

Tax avoidance

There is also the added advantage of being able to swap your cryptocurrency for another asset and thereby avoiding tax. Although we strongly suggest not going down this road.

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Anonymous

Ex-president Obama once said in 2017 “Bitcoin is like having a Swiss bank account in your pocket.” Although it is possible to find a wallet’s address and see the activity in that wallet, it is very hard to find out the ownership of that wallet.

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Affordable

The fees are very low and in some instances nearly free to transfer millions and even billions of digital currency across the world.
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Transferable and spendable

It was quite common during 2017 and 2018 to hear the average person remark that bitcoin or altcoins was not real money and you can’t buy anything with it. This is erroneous. There are tens of thousands of ATM cash points worldwide that allow you to convert cryptocurrency directly into cash and take it from a cash machine. View our crypto shopping section to see what you can buy using cryptocurrency.
There are shops in the United States of America and London for example that allow a person to walk into a Bentley, Ferrari, and Rolls Royce showroom and buy a car with bitcoin or Ethereum.

There are property websites where you can swap your cryptocurrency for a penthouse or mansion overlooking the sea. You can even buy physical gold and silver bars with cryptocurrency.

This website is dedicated to listing businesses that offer goods and services for payment in cryptocurrency and bitcoin. The owner Jonathan Titley bought the spendingcrypto domain name in 2018 after he decided to create a website to show how spendable cryptocurrency really is!

Understanding Bitcoins and Altcoin spot prices

The Bitcoin price is based on the cost of one entire Bitcoin, similar to the purchasing of one AAPL stock share.

However, unlike many traditional markets, you can buy and sell fractional amounts of Bitcoin. For example, if the Bitcoin spot price is $50,000, you can buy 0.1 Bitcoin for $5,000. It is also possible to buy far more or less fractional amounts.

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Arbitraging

There are many Bitcoin exchanges and the spot price can differ between each exchange, especially with Altcoins.

Some traders make a very good living from literally trading the spot price differences daily between the different exchanges. Simply put, if the market price between two exchanges diverges enough, an opportunity presents itself, where Bitcoin and some Altcoins can be bought on one exchange for a lower price and then subsequently sold on another exchange for a profit.

This is the main mechanism that keeps prices on various exchanges in line with one another.

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Volatility

The Bitcoin and altcoin price movements are often the topic of conversation for investors and rightly so. With such large price swings, many savvy investors are making a serious amount of money. Imagine being a swing trader in the crypto market right now.

This type of trading is not for the faint-hearted and so we advocate caution if you are looking at swing trading.

The websites below are well worth visiting to learn more about Cryptocurrencies

Blockgeeks

One of the best sites to learn about crypto, earn crypto, and get crypto certified. Join and upgrade your skills and build a new career.

Enter the website and go to the Guides tab at the top of the site. Inside Guides, you will find everything you need to learn about Bitcoin, Ethereum, Blockchain, and Crypto. They also have a section called Courses where you can increase your skill base and earn qualifications.

Wikipedia

A go-to site for internet information with external links to other sites. They cover what is Bitcoin, Altcoins, Blockchains, Mining, Wallets, Regulations, and more.

Cointelegraph

A very well known Crypto news and information site.

Investopedia

One of the best go-to websites for learning about investing.

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