Everyone has heard how Bitcoin and other cryptocurrencies have made millionaires from those they bought just a year ago. Gains of 1000% or more are not just possible, they have been a commonplace for many of these cryptocurrencies. Someone who bought bitcoin in May 2016 for less than $ 500 would have a profit of 1400% in about 17 months. Then over the last few days, we’ve seen Bitcoin lose almost $ 1,000, so to say that these cryptocurrencies are volatile would be a huge understatement.
Since the creation of bitcoin in 2008, we at Trend News have been skeptical about the ability of cryptocurrencies to survive, given that they pose a very clear threat to governments that want to see and tax all transactions. But while we can still be cautious about actual cryptocurrencies, we are well aware of the potential of the underlying technology that drives these e-currencies. In fact, we believe that this technology will have a significant impact on data management and will affect every sector of the global economy, just as the Internet affects the media.
Here are some questions and answers to get you started …
Q: What are cryptocurrencies?
The most famous cryptocurrency (CC) is BITCOIN. It was the first CC launched in 2008. Today, there are more than 800 CCs, including Ethereum, Litecoin, Dash, Zcash, Ripple, Monero, and they are all “virtual.” There are no “physical” coins or currency.
Q: How do CCs work?
CCs are virtual currencies that exist in very large distributed databases. These databases use BLOCKCHAIN technology. Because every Blockchain database is widespread, it is believed to be immune to hacking, as there is no central point of attack and every transaction is visible to everyone on the network. Each CC has a group of administrators, often called “miners”, who validate transactions. A CC called Ethereum uses “smart contracts” to validate transactions. Crypto TREND will provide more details in upcoming news releases.
Q: What is BLOCKCHAIN?
Blockchain is the technology that underlies all CC. Each transaction for the purchase, sale or exchange of CC is entered in a BLOCK, which is added to the chain. This technology is complex and will not be explained here, but it has the potential to revolutionize the financial services industry, as transactions can be executed quickly and easily by reducing or eliminating fees. The technology is also being tested for applications in many other industries.
Question: Are CC exchanges regulated by the state?
For the most part, the answer is NO, which for some consumers is a big attraction in this market. It is currently a ‘wild west’, but governments in most developed countries are exploring this market to decide what regulation may be needed. A big decision is whether to treat CC as a currency or as a commodity / security. Canada and the United States have so far declared that CC is legal, but the situation remains fluid in terms of reporting and tax implications. Crypto TREND will monitor and report on these developments.
Q: How do I invest in this market?
You can buy, sell and exchange CC using the services of specialized “exchanges” that act as intermediaries. You start by selecting the exchange, setting up an account and transferring fiat currency to your account. You can then place your orders BUY and SELL CC. There are many exchanges around the world. Opening an account is quite simple and all these exchanges have their own rules regarding initial financing and withdrawals.
Crypto TREND will recommend CC exchanges in the future.
Question: Where do I keep CC?
To have the freedom to move your cryptocurrencies and pay bills, you will need to have a digital wallet. These wallets come in several formats, such as desktop, cloud, hardware (USB), mobile phone and paper. Many of them are FREE, but security is a big factor because no one ever wants to lose their wallet or steal it. Crypto TREND will recommend digital wallets in the future.
Q: What can I do with my CC?
In addition to investing in CC products, you can also use cryptocurrency for some financial transactions, such as money transfers and bill payments. The list of companies accepting cryptocurrency is growing rapidly and includes major players such as Microsoft, GAP, JC Penny, Expedia, Shopify, Bloomberg.com, Dish Network, Zynga, Subway and WordPress.
Q: What’s next?
When we start, we will keep each of the Crypto TREND articles short and keep the scope of each of them as narrow as possible. As noted earlier, we believe that cryptocurrency technology will change the game and potential investment opportunities like this happen once or twice in a lifetime. Make no mistake, early investment in this sector will only be for your most speculative capital, money you can afford to lose.
Even if you do not want to invest at this time, an early understanding of this new destructive technology will put you in a good position to take advantage of our recommendations as we move forward.
Expect to see more news and specific recommendations from Crypto TREND as we embark on this journey into what may at first seem like a foreign jungle. This is an unstable market and may not be to the liking of all investors, but Crypto TREND will be your guide if and when you are ready.
Stay on the line!