Now the most talked about topic in the world is cryptocurrency. It will be hard to find people who don't know about it. The main purpose of entering the cryptocurrency sector is to make money, but not everyone succeeds. Many people are seen leaving the crypto business after a few days.
The popularity of cryptocurrency trading is growing rapidly. You can't deny it. People seem to be very interested in investing money in cryptocurrency. Some consider it as their passive income. Some are even quitting their jobs for concentrating full-time.
One can easily understand the importance of cryptocurrency by seeing the recent situation of the Russia and Ukraine war (2022). The USA and many European countries ban Russia from SWIFT and decrease the value of the Russian Ruble. But Russia prepared to tackle the situation by using cryptocurrency for their foreign trading.
Before going into the crypto business, first, you have to know what cryptocurrency is and how it works. Today, in our discussion we will give you a simple guide on cryptocurrency for beginners.
What is Cryptocurrency?
Cryptocurrency serves as a digital asset that can be used without the need for a central financial authority like a bank. People can safely buy, sell or trade using cryptocurrency. Cryptocurrency transactions are more secure than any other transaction. Every crypto transaction will be recorded on a public ledger. So, there is no possibility of losing or destroying data.
Most crypto trading platforms use a two-factor authentication system. That is why every user's account is secure from any unethical activities
How does Cryptocurrency work?
We already know that cryptocurrency acts as a digital currency. For crypto transactions, you need to use a digital wallet to exchange digital money with other users. This wallet will help you to transfer funds from one account to another. To complete a transaction, you need to access a password known as a private key. The key will work much like a bank account for you.
Here all your transactions will be automatically recorded in a public ledger and it will show the total number of transactions without revealing the identity of the parties involved. Sometimes people think that if you own a cryptocurrency you are the owner of something for real but the reality is different. Owning a cryptocurrency means you own something digital that you can use digitally to make any transactions with other online users.
Examples of Cryptocurrency:
There are thousands of cryptocurrencies in the world. Today we will discuss some famous and well-known cryptocurrencies.
The first cryptocurrency launched in 2009 is known as Bitcoin. It is one of the most common and expensive cryptocurrencies in the world. Bitcoin runs on a public ledger which is known as the blockchain. A bitcoin block contains information about the number of senders, recipients, and transferred bitcoins.
Ethereum is now the second-largest cryptocurrency after Bitcoin. This coin is also known as “Ether” which was launched in 2015. Ethereum's main goal is to create a decentralized suite of financial products that anyone in the world can access freely.
Litecoin (LTC) was launched in 2011 and was one of the first cryptocurrencies to follow in Bitcoin's footsteps. The coin was created by an MIT graduate and a former Google engineer named Charlie Lee.
Litecoin is not regulated by any central authority. It is based on an open-source global payment network that can be decoded by customer-grade central processing units (CPUs). Although Litecoin is similar to Bitcoin in many ways, its block generation rate is very fast.
Tether was launched in 2014 and it is also known as a blockchain-enabled platform. This cryptocurrency allows individuals to use a blockchain network and related technologies while transacting in traditional currencies. The system allows users to access US cryptocurrencies from other cryptocurrencies.
How to make money with cryptocurrency?
The main purpose of cryptocurrency is to make money. If you want to know how to make money with cryptocurrency then check the points below:
To be a successful trader you need to have proper analytical and technical skills in crypto trading. If you analyze the market chart on the performance of listed assets, you will be able to make accurate predictions about the price. That is how you can make a good amount of money.
Buy and Hold crypto
In this way, you can buy coins like Bitcoin, Ethereum, Ripple, and many more and wait until their value increases. Once their market price rises, you can then sell at a good profit.
For investors, crypto stacking acts as a passive income. When you, as a crypto investor, place bets on your holdings, you can use those holdings to create new blocks in the network blockchain. The more crypto stock you have, the more likely you are to choose a holding.
So, you can say, Staking is simply the process of purchasing and holding a cryptocurrency in your wallet and making a good profit from it.
Cryptocurrency has taken the world by storm over the past decade. People are now leaning towards the crypto business. As a beginner, if you want to start a crypto business, first learn about it and get started. Hopefully, this blog will help you make a better decision for your future.