By now you should have at least heard discussions about cryptocurrencies. Or you have had talks about Bitcoins, Ethereum, Litecoin, and Moneros, among other cryptocurrencies. So, what is cryptocurrency?
Definition of Cryptocurrency
Cryptocurrency is a digital currency, which uses encryption techniques to secure the currency, generate more units, and verify the transfer of funds. It operates independently; without the regulation of a central bank.
A cryptocurrency is a digital asset with the ability to function as a medium of exchange. It is quickly becoming the focus of most bankers, scientists, consultants, and investors.
Hence, it is necessary that everyone arms themselves with lots of information about cryptocurrencies. Below are some facts that will make it easier to keep up with the cryptocurrency jargon around you;
The history of cryptocurrency
The history of cryptocurrencies begins with a genius called Satoshi Nakamoto. He unknowingly invented the most famous cryptocurrency known as the Bitcoins.
According to him, he was trying to establish the missing link to coining a digital cash system. It is as if he stumbled upon the cryptocurrency idea.
The most popular cryptocurrencies
The most commonly used cryptocurrencies include Bitcoin, Ethereum, Ripple, Litecoin, and Monero as follows;
Bitcoin is the most popular cryptocurrency. It is widely used as a means of executing global transactions. It is estimated that the number of daily transactions in Bitcoin is 200,000. Currently, its market price is $650.
Ethereum, on the other hand, is an invention of Vitalik Buterin. It ranks second among the famous cryptocurrencies. Ethereum is perfect for sophisticated programs and contracts.
The third cryptocurrency is called Ripple. Ripple is not very popular. In fact, for most people, it is not a real cryptocurrency. Its function is to protect digital networks from spam. Ripple is the most favorite cryptocurrency for many banks judging by their fast adoption of the digital currency.
Among the very first cryptocurrencies to be invented, the Litecoin was branded silver. It is faster than the bitcoin. Besides, it was used as a basis upon which other cryptocurrencies such as Dogecoin came into being. Litecoin is the backup plan, in any case, Bitcoin fails.
Then, there is Monero. Its popularity rose in the summer of 2016 when it was accepted as a digital currency. Initially, it had been known to be a cryptonite algorithm with the ability to secure the Bitcoin transaction trails.
Trading cryptocurrencies in the stock market
For an investor to trade cryptocurrencies in the stock market, they do so using the GBTC trust. The GBTC trust is the Bitcoin Investment Trust used by investors to buy and sell cryptocurrencies on the stock market. Investors need to pay a premium to use the trust.
As to when is the best time to invest in cryptocurrencies, I would say it is never too late to start. The rise in the value of cryptocurrencies is made faster by the increased knowledge about them. Hence, the right time is now. Invest in cryptocurrencies of your choice!