Cryptocurrency is the currency of the future. With high returns and easy to use, this digital currency is the money for the future.
With the world getting digital, it was only logical to have a source of digital money. Cryptocurrency or crypto coins fill up this space as they have now carved a niche for themselves in the world financial markets. Starting in 2009, the concept of Cryptocurrency and the fact that you could mine and earn your own crypto coins caught the fancy of many software experts and mathematicians. Earlier, the mining of coins was much easier than it is now, and with the craze of Cryptocurrency catching up, pool mining or collective mining is the trend.
The reason for this is that there are only 21 million coins that can be mined. Further, each cycle of mining produces only 50 coins per block and this number gets halved after every 210,000 blocks. The situation comes after every 4-5 years and this is expected to happen by 2019. Thereafter, each mining cycle will mine only 25 coins although the complexity of the equations will remain the same.
For the same reason, the year 2017 saw a 900% upsurge in the value of the cryptocurrency. For those who are open to taking risks in this ‘decentralized’ system and are looking to multiply their money in the short term, investing in cryptocurrency is a good option. Here are the basics of buying and investing in Cryptocurrency to give you a steady and informed start.
Understand The Concept Behind Cryptocurrency
Cryptocurrency is a peer-to-peer electronic cash transmission method that works on its internal network. Most financial systems have a centralized node and a regulatory authority. This is not the case with Cryptocurrency and each computer through which transactions are made keeps on getting added as a node in the network. This means that all of the transactions made with Cryptocurrency are recorded in a public ledger system (blockchain) which helps in maintaining transparency and also works as a safety feature. Due to this recognition, wallets and transactions get encrypted and can be done through a code only that is sent to the user.
Ensure You Always Buy Cryptocoins From A Reliable Source
You can get your cryptocurrency through two ways – first, you can mine them or second, you can procure them from a cryptocurrency exchange. The option of using a cryptocurrency exchange is the option that most laymen or consumers use. There are many cryptocurrency exchanges that offer cryptocoins through various names like Bitcoin, Ethereum, White Bitcoin, but conceptually these coins are the same. All you need to do is go with a reliable service provider and one way to check this is to go through the website and see the services mentioned. For e.g. when you go to Indus Coin, you will clearly see their offering. One of the best features here is that you have a safe wallet to store your currency here.
To elaborate, whenever you will transact, you will need to provide a new password which is generated through encryption. However, you can view your account balance and past transactions on the go. You can download the app and use it like any other mobile wallet for the purpose of transactions.
Go Slow With Your Investments
Cryptocurrency investments come with their own risk. The return on investment is humongous and therefore, if you have an appetite for financial risk, then you can go in for this option. However, start slow and do not invest huge amounts of money in cryptocurrency trading. Once you get the hang of the returns, you can buy more coins and trade them. Trading is similar to the conventional trading of Fiat currency. Look for cryptocurrency tickers on the stock exchange.
Keep A Track Of Your Investment
Since the risk is high, you must always check the progress of your investment. There is no Government that recognizes cryptocurrency as legal currency. However, it has thrived for ten years and is growing exponentially. The chances of any Government banning this form of currency are low; however, you must check the legalities of your country with respect to this form of currency before making the investment.
The volatility is high although the currency is immune from inflation. Tracking your investment and making sure that your value is not decreasing is the best thing to do. Also, it is worthwhile to make short term investments initially and then go for long term investments.
Explore The Multiple Uses Of Cryptocoins
The most common use for cryptocurrency has been for investment purposes, but there are also other uses of cryptocoins. If you are looking at an investment perspective and are not convinced of your decision, then be rest assured that you will not lose out on your money. There are many merchant stores and vendors who have started accepting cryptocurrency as the mode of payment. Dell is one of the notable names in this list. Grocery outlets, food and retail outlets are also joining this list where you can use cryptocurrency for buying commodities.
Travel operators and hotel operators are also exploring the option of accepting cryptocurrency. The biggest reason for this is that businesses are also looking at cryptocurrency for investment purposes. Everybody is looking at big gains from this source and therefore, the future for cryptocurrency is bright.