A cryptocurrency is digital money: this means that it does not exist physically, but exclusively online. In recent times, interest in investing in cryptocurrencies has grown 136% in the world. In this note we tell you everything you need to know about cryptocurrencies and how to invest safely in them.
Cryptocurrencies: what they are and how to invest in them
To start, what you have to know is that cryptocurrency is digital money. That means it doesn’t exist physically, but online. Basically, it is a type of alternative currency or digital currency. It is also called cryptocurrency, a word that comes from the English cryptocurrency, cryptoactive or, simply, virtual currency.
How do cryptocurrencies work?
Cryptocurrencies can be transferred to anyone through the Internet without the need for an intermediary, such as a bank. They can also be used to make payments. Some people buy them as an investment, hoping that they will increase in value.
It is important to note that the value of a cryptocurrency is constantly changing. In other words, if you are going to make an investment with any cryptocurrency, you have to know that today it can be worth thousands of dollars, and tomorrow it could be worth only hundreds of dollars. If the value falls, there is no guarantee that it will rise again.
How to buy cryptocurrencies?
You can do this with a credit card or, in some cases, through a process known as “mining.” What does mining mean? This means that they are stored in a wallet or digital wallet, whether online, on a computer or other physical medium.
What is Bitcoin?
Surely when talking about cryptocurrencies you have heard about Bitcoin. This was the first implementation of the cryptocurrency concept. And it was the first decentralized payment peer-to-peer network that was powered by its users. In other words, it does not have a central authority, nor does it have intermediaries. Bitcoin is also a consensual network that allows a payment system and a completely digital currency.
How does Bitcoin work?
The Bitcoin network shares a public accounting, which is the blockchain, which contains each transaction processed. This allows you to verify the validity of each transaction. And the authenticity of each transaction is protected by digital signatures corresponding to the sending addresses: this allows all users to have full control when sending Bitcoins from their Bitcoin addresses.
Why do users invest in cryptocurrencies?
In April 2021, according to Google Trends, in USA interest in cryptocurrencies grew 136% compared to the same period last year. It had a volume similar to that of searches for “fixed terms”. This trend continued to rise in favor of cryptocurrency investments in the following months.
In this way, the interest in acquiring cryptocurrencies increased by 300% in the last year and the search for “buying Bitcoin”, by 200%.
But we did not answer the question how to invest in bitcoin and make money? The answer is this: because people are in control of their own assets at all times.
Is it safe to invest in cryptocurrencies?
Cryptocurrencies are not insured by a government, like bank deposits are. This means that cryptocurrencies stored online do not have the same protections as money deposited in a bank account.
The cryptocurrency market allows the construction of various tools and services in a decentralized way. And precisely, from there derives the transparency in the process. This results from the chain of blocks and smart contracts that allow automating processes to generate financial instruments as it does not have third party intervention.
For you to have greater security, we tell you that the exchange, which is carried out completely digitally, uses strong cryptography that secures transactions, controls the creation of additional units and verifies the transfer of assets using distributed ledger technologies.
