A Simplified Guide to Cryptocurrency for dummies

Everyone has heard about Cryptocurrency, and not all people know how it works. Before we share with you some guide about cryptocurrency for dummies, have it in mind that Cryptocurrency is volatility and this violability was often lined to the ever-changing regulations.

Cryptocurrency market always fluctuates and is expected to reach the value of $1 trillion this year.

Table of Contents

What is simple meaning of cryptocurrency for dummies

Cryptocurrency can be described as a type of currency that uses digital files as money. One thing to be made clear is that one person or any government doesn’t control cryptocurrency because the first Cryptocurrencies were made to be independent of government issued currencies.

It uses decentralized control, unlike “traditional” currencies. The more significant advantage is that cryptocurrency transfers are secure, anonymous, and transparent.

Presently, there are more than 4000 existing cryptocurrencies, and most of it based on blockchain technology, but we will list out five of them.

Blockchain

It is a decentralized and distributed database. It is the open-source model. It works in a P2P network, which is not controlled by any third party.

Bitcoin

Satoshi Nakamoto Creator of Bitcoin was well known and one of the largest cryptocurrency by market capitalization. It was revealed that the price of altcoins directly connected to Bitcoin price, as it was considered to be the first decentralized cryptocurrency.

Once it grows, the market goes up, and when the Bitcoin falls, the market goes down.

Ethereum

Ethereum is opposite to Bitcoin as the second most well-known cryptocurrency platform, Vitalik Buterin created it.

It was designed to feature a smart contract and provides a decentralized virtual machine.

Altcoins

Mostly, altcoins call all cryptocurrencies except for Bitcoin. Both the altcoin and Token are mistakenly used as synonyms as their structure is different.

Tokens

Tokens depend on another cryptocurrency as a platform to operate, which is different from altcoins.

It operated on top of the blockchain and was designed to facilitate the implementation of decentralized applications.

Cryptocurrencies tokens are much easier to create than the altcoin.

Jumping into cryptocurrency without making a plan can be dangerous. The strategy is the way out, and let’s quickly see the steps to that.

What to buy
When to buy
How much to buy
When to sell

Benefits of cryptocurrency

Some don’t believe that cryptocurrencies are better than traditional government bases money. Kindly see the solution or benefits you can get through cryptocurrencies.

Reducing corruption

Eliminating extreme money printing

Cutting out the middleman

Giving people charge of their own money

Serving the unbanked

PEOPLE’S QUERIES RELATED WITH CRYPTOCURRENCY

There are so many answers we are going to reveal base on the question people do ask.

Q1 Can you become a millionaire with cryptocurrencies?

You can use cryptocurrencies to get rich and to become a millionaire, but that doesn’t mean instantly.

Getting rich requires focus and smartness, and for this, you have to research and analyze every coin to make decisions that bring you a fortune.

Q2 Can cryptocurrency be converted to cash?

Yes, you can convert bitcoin to cash and move it to a bank account. There are many cryptocurrency exchange, like Kraken or Coinbase.

Q3 Is cryptocurrencies legal?

Well, as the cryptocurrency is becoming a significant player as a worldwide fiat, many countries don’t allow it while some allow it. Russia, China, and Bolivia don’t allow it, but in others, like the United States and Canada, it’s perfectly acceptable.