How “Crypto” Currencies Work – A Brief Overview Of Bitcoin, Ethereum & Ripple

“Crypto” – or “crypto currencies” – are a type of computer software which provides transactional functionality to users through the Net. The main feature of the system is their decentralized nature – typically provided by the blockchain databases system. sell bitcoin

Blockchain and “crypto currencies” have grown to be major elements to a global zeitgeist recently; typically because of this of the “price” of Bitcoin skyrocketing. This has business lead millions of men and women to be involved in the market, with many of the “Bitcoin exchanges” undergoing massive infrastructure strains as the necessity soared. 

The most important point to realize about “crypto” is that though it actually provides a purpose (cross-border orders through the Internet), it does not provide any other financial benefit. In other words, its “intrinsic value” is staunchly limited to the ability to transact with other people; NOT in the keeping / disseminating of value (which is what most people view it as).

The most important thing you require to realize is that “Bitcoin” etc are payment systems – NOT “currencies”. This kind of will be covered more deeply in an additional; the main thing to realize is the fact “getting rich” with BTC is not a case of supplying people any better monetary standing – it’s this is the process of being able to buy the “coins” for a low price promote them higher.

To this end, when looking at “crypto”, you need to first understand how it really works, and where its “value” really lies…

Decentralized Repayment Networks…

As mentioned, the key thing to bear in mind about “Crypto” is the fact it’s predominantly a decentralized payment network. Believe Visa/Mastercard without the central processing system.

This is important because it features the true reason why people have really commenced looking into the “Bitcoin” idea more deeply; it offers you the ability to send/receive money from anyone around the world, providing they have your Bitcoin wallet address.

The reason why this attributes a “price” to the many “coins” is due to misconception that “Bitcoin” will somehow give you the ability to earn a living by virtue of being a “crypto” property. It doesn’t.

The SOLE way that folks have recently been making money with Bitcoin has been due to the “rise” in their price – purchasing the “coins” for a low price, and selling them for a MUCH higher one. Whilst it proved helpful out well for many, it was actually based off of the “greater fool theory” – essentially stating that if you manage to “sell” the coins, it’s to a “greater fool” than you.

Therefore if if you’re looking to get included with the “crypto” space today, you’re basically looking at buying some of the “coins” (even “alt” coins) which are cheap (or inexpensive), and riding their price rises until you sell them off later on. Because none of the “coins” are supported by actual assets, there is no way to estimate when/if/how this will work.

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