What is a cryptocurrency?

By now you’ve probably heard so much about bitcoin that you may consider yourself an expert. Since bitcoin launched in late 2009, a whole range of different cryptocurrencies have emerged, all of which are designed for different purposes.

You may have even heard of some of these cryptos, such as ethereum, ripple, or litecoin. In fact, there are now over 1,500 different cryptocurrencies in circulation. But it’s their enigmatic nature that has captured the attention of the finance industry.

Which begs the question: What exactly is a cryptocurrency?

A crypto is a new form of digital money. And it’s only found online. There are no tangible coins or notes; all payments and storage are handled via the internet. This is all made possible via a unique system called the blockchain.

The blockchain is the technology that makes cryptos unique. Sometimes referred to as distributed ledger technology, it is a massive online record of every transaction ever made for a crypto.

However, what makes this record unique is that it isn’t updated by a central authority, like a bank. Instead, blockchain uses peer-to-peer networks. Meaning that all the individuals making the transactions keep the record updated themselves. Cutting out the need for a third party completely.

This decentralised nature is what makes cryptos superior to normal transactions. By cutting out the middlemen, payments are faster, cheaper and more secure.

Why are there so many cryptos?

1,500 currencies does indeed sound like a lot. For most people it’s hard enough keeping track of the five biggest cryptos. What’s more, the number of cryptos in circulation is only growing by the day.

However, not all of them are going to be successful. At present, only 26 coins have a valuation over US$1 billion. And just five have a valuation in excess of US$10 billion. Though these numbers are fluctuating rapidly.

A new crypto could skyrocket in value literally overnight. While others can crash just as fast. These coins are extremely volatile, due to the fact that they’re still quite new.

Think of them as a financial experiment. We’re still not quite sure where they fit in the bigger picture. Which means valuing these coins is incredibly difficult and subject to sudden and dramatic swings.

Right now bitcoin is the oldest and most popular crypto. However, that could change in the future. Every crypto is currently trying become the top dog. Desperately looking for that one genius idea that makes them the next, Inc. [NASDAQ:AMZN] or Facebook Inc. [NASDAQ:FB].

That’s what makes cryptos so exciting. Not one of them has really broken through to mainstream adoption just yet. Whichever coin cracks that code however could change transactions forever.

There are plenty of hopefuls, but not all of them will be winners. There will certainly be a market for a few coins, but not thousands of them. Which is why investing in cryptos is incredibly risky.

Chancy coins

There are no ifs, buts or maybes about it. Cryptos are very risky. There is no safety net if things go belly-up. No regulator to make sure traders aren’t getting scammed. We call it the Wild West of investing.

Things are getting better, and in time regulators and precautionary measures may make it a safer investment. For now, though, this isn’t a market for the faint-hearted. This isn’t the type of investment to dump your life savings into.

You’ve got to be smart and have your wits about you. It’s perilous, but there are some serious gains to be made if you’re an investor that doesn’t mind putting down money on a risky investment.

Read more
cryptocurrencies are here to stay
Smashing the Paradox
As the crypto revolution takes off, we will be able to leave a broken financial system behind. The slow, inefficient and expensive system that caused the GFC and the dotcom bubble. And by staying in the right cryptos, there is a way to profit from the revolution.
You Could Have Made 70,000% by Investing in ‘Green Beans’
Why are cryptos so interesting for the area? Apart from the attractiveness of recent gains, inflation and hyperinflation are both quite common in the area. As Bloomberg reports, trading volume in cryptocurrencies has increased quicker in countries with capital controls and weakening currencies.
digital currencies and the blockchain
Private Currencies vs. Public Money
Blockchain is definitely allowing people to think about the future of money and how we use that money. And the rise of parallel currencies could increase competition for central banks. That is, if the central bank printed too much money and devalued the currency, people could flock to a more stable private currency.
free bitcoin if you can solve an art piece
Want Some Free Bitcoin?
Well, not exactly free. It does require you to do some work. As Bauch told Gizmodo, he bought several cryptos and put them in individual wallets. Each piece in the series has a secret key embedded for each wallet. In total, there is about US$10,000 in crypto. Yet knowing cryptocurrencies this could be worth a lot more (or less) tomorrow.
Forget Bitcoin and Focus on Stocks
Forget Bitcoin and Focus on Stocks
Have you heard the latest news? Twitter banned advertisements on cryptocurrency initial coin offerings (ICOs). Bitcoin fell 7% on the news. It's currently trading below US$8,000 at the time of writing. Weeks of regulatory uncertainty has weighed on the digital currency.
bitcoin cryptocurrency money
What is Happening in the World of Cryptocurrencies?
Binance Exchange is the largest cryptocurrency exchange in the world. The Japanese agency told the exchange it was operating in the country without a license, and threatened to press criminal charges. So, Binance Exchange announced they would be moving to Malta.
bitcoin cryptocurrency money
Is This the Future of Money?
In a crisis, cash is king. But with physical cash disappearing, we are losing control over our own money. Cryptos, being outside of the system, could give you another option to access cash to buy necessities or move money in a time of crisis.
cryptocurrencies are here to stay
Is There a Future for Cryptos?
All appears quiet in the world of crypto. The roaring optimism we saw last year has died down considerably. Though, right now, new cryptos are popping up all the time. Blockchain innovations are even more prevalent. Clearly, the crypto market is still alive and kicking.
bitcoin price falling could be a good thing for investors
Why the Falling Bitcoin Price Is Good for Crypto Investors
A crashing bitcoin market has scared many people. But that could be a good thing. It means all the people speculating on cryptos are most likely pulling out of the market. Leaving it wide open to everyone that believes in the long-term potential of this technology.
cryptocurrencies and the history of money
Cryptocurrencies and the History of Money
Throughout history, people have trusted forms of money when those around them have trusted the same value. This trust is enhanced when people can rely on regulatory authorities to keep the system above board. It’s ironic. Cryptocurrencies were invented as a medium of exchange outside the system. Bringing them back into the system with regulatory controls may be the very thing necessary to ensure public confidence.
bitcoin dead?
Manias and Myths
There’s nothing more mythical than a booming market. With cryptos now re-entering Earth’s orbit, where are the ‘bitcoin to $1 million' headlines? All but gone. The more things change, the more they stay the same. The only thing different about the current mania is the cast. The plot is still the same…easy come, easy go.
russian gold stocks
The New Golden Rule
Repeated international economic sanctions continue to encourage Russian President Vladimir Putin to look for new ways to avoid the US dollar. Russia’s increasing gold reserves shouldn’t be ignored. Even though the precious metal isn’t at the centre of the financial system today, gold still equals power. Late last year, however, Russia added a new twist to the story. 
crypto wars
The Great Crypto War
Ever since cryptocurrencies made their mainstream debut, they’ve been polarising to say the least. In response to crypto mania, companies in the tech and finance industries have split off into two staunchly opposed camps.
facebook crypto advertising ban
Facebook Wants to Control You
Facebook — while not a country — is the latest in a long line of states and institutions attempting to control the bitcoin market. I find it near impossible to believe Facebook gives two rats about scams and deceptions not operating in good faith. This move by Facebook is all about headlines. It has nothing to do with protecting you.