What is a cryptocurrency?
Interest for various kinds of digital currency continues to grow, people are more and more interested in buying and even mining cryptocurrency.
In our article, we will dwell in detail on the question of what a crypto currency is and how to make money on it.
What is a cryptocurrency? What are its advantages?
Cryptocurrency is a virtual currency, where a certain information is encrypted, a code that cannot be copied.
Cryptocurrency, unlike ordinary money, is a decentralized unit videlicet the issue of this currency is not related to the state monetary system and the central government.
The digital currency is issued directly to the network, so there is no need to physically deposit any other currency into the account with the help of the bank in order for the cryptocurrency to acquire its digital form. This is what distinguishes it from electronic money (such as WebMoney, Yandex money, etc.).
The advantage of crypto currency is its open algorithm code. Absolutely any person can engage in “mining” of virtual currency. “Mining” by itself does not require for a special permit, the only thing needed is a powerful computer and specialized software.
Another advantage of crypto currency is the ability to remain anonymous. only the purse numberis publicly available, with it you can trace the transactions that were committed, but it is impossible to find out exactly who owns this purse. Thus, the full anonymity of the owner of the crypto currency is preserved.
In addition, the circulation of crypto currency is not associated with any commissions. Virtual currency is a public currency that is not tied to any country, and the circulation of which is not regulatedin most of them. There is no control over transactions and payments.
And last but not least is the security of the crypto currency. Its code is unique and cannot be copied.
How to make money on the Cryptocurrency?
How can you earn, taking into account all the listed advantages of a virtual currency? Currently, several main areas are identified, which first of allinclude mining, trading, ICO.
As already mentioned above, anyone can be engaged in mining. To do this, you need to connect to the network, “provide computing power” and get a crypto currency in return. Most importantly, many regulators emphasize the fact that mining itself does not require any license (see our previous article “Regulation of virtual money in Germany”).
As for trading, this is the most common way of working with crypto currency. This type of activityhas the low entry threshold. In order to start trading in crypto currency, you only need to create your own account on one of the exchanges and purchase a cryptocurrency.
Another method of earning with crypto-exchange is ICO. In the ICO process, companies sell digital tokens to investors in order to raise capital in exchange for a crypto currency. Investors can use these tokens as a means of payment within the platform, or in the future when prices of these tokens jump up, exchange them for another crypto currency, and receive the profit. By participating in ICO you have the opportunity to buy tokens at low price, and after these tokens are launched on the exchange, the price can increase a lot.
Thus, with ICO, both project owners and investors win.
In this context, many will have the question, how can you deduce the crypto currency and can it be done at all?
In the network there is a sufficient number of services that offer to exchange crypto currency for real money, as well as services that contain analysis of data of exchangers (exchange directions, current rates) and help to make a profitable choice.
Thus, it is quite possible to say that now you can earn on cryptocurrencies and you can do it quickly enough.
However, one must be cautious, as today the market of cryptocurrency is still small and is not regulated at all.
There are no rules, standards and regulatory requirements for this segment.
Keep an eye out for our next articles in the field of crypto currency and blockchain technology.