Cryptocurrency is one of the varieties of digital currency that is created, protected, and controlled by unique cryptographic methods. A cryptocurrency is a payment unit, money that cannot be faked, since, in essence, cryptocurrency is a code, an encrypted record in a digital data bank, copies of which are synchronized continuously in different computers in different parts of the world.
The basic concept of cryptocurrency trading
Cryptocurrency trading is carried out only using the Internet, where its circulation is carried out in a single network, which consists of different independent computers. Cryptocurrency storage is possible on:
- Personal computer;
- On removable media;
- On a web service;
- On the map;
- And even on paper.
The first variant is the most convenient one.
Cryptocurrency as the modern system of payment
Currently, new methods and forms are appearing. Storage of cryptocurrency has become one of the main tasks for those involved in its mining. The actual mining methods are different.
The notion of mining
What is a bitcoin trading today, according to public opinion? It is mining. Cryptocurrency mining is the extraction of virtual money using individual devices, robust computer systems. Experts say cryptocurrency mining is the extraction of cryptocurrency program code, the combination for which is selected as the key to the safe, through many numerical variations. This definition also implies the difficulties of cryptocurrency mining, which requires:
- Expensive professional equipment;
- Special knowledge;
- High costs of electricity consumed.
Cryptocurrency mining is not only difficult in terms of professional knowledge but also an expensive business.
How to earn money on mining
The complexity of cryptocurrency mining has long been known around the world. Cryptocurrency mining is reduced to a series of computer calculations with the selection of parameters for finding data with specified properties. The system provides the cryptocurrency reward for the creation of the next structural unit, that is, the generation of a new block. At the same time, a cryptocurrency business is not only mining, which requires substantial investments, but also:
- Exchange of cryptocurrency on the digital platform.
The activities, as mentioned above, can be carried out simultaneously or one by one.
Profitability of crypto trading
The profit from mining and the ability to sell crypto currencies depends on many components of this new direction in business, including the market cap. Pioneers, those who “entered this topic” about three years ago, were able to earn millions of dollars on the growth of cryptocurrencies, BTC or eos.
Today, according to some posts in facebook communities, the rate of return on such investments has slowed slightly. After the recent sharp recession, some participants in the “digital market” began to get rid of cryptocurrency, while others buy coins during the crisis and believe in future profits.
However, to make a profit in this business, you need to understand the laws of the modern digital market deeply. The difficulties in mining cryptocurrency are not only that a conventional computer is not suitable for mining; it needs ultrafast, but that the time of lone miners has passed. Already states have joined this new business, promising millions of profits, such as:
- The USA.
The countries of Asia are especially active while working with bitcoin cash.
Practical use of digital currency
The popularity of cryptocurrency as a means of payment is growing every day. The bitcoin price is quite stable. Today it is possible to pay with cryptocurrency many goods or services, to make charitable contributions, it can also be exchanged for real money. Such a payment system accepts the cryptocurrency like PayPal, many electronics stores, even a Moscow taxi, and one Latvian airline. It is possible that soon it will be possible to pay with litecoin for any product or service.
Prospects for the future
Cryptocurrency has not only spawned economic relations in the digital environment, focused on interactions using network protocols and cryptographic algorithms. Current economic conditions have changed, and social relationships between people:
- Buyers and producers of goods;
- Customers and recipients of services;
- Those who supply software and other digital production;
- Business partners.
Crypto currency is undoubtedly the future of payment systems
The principle of transparency
A huge plus of the cryptosystem in frameworks of market cap, which is an open program, the same for everyone is its transparency. Here the human factor is minimized. The operating system action log for the entire cryptoeconomics – blockchain (bch) – runs on the computers of all users, there is no central server.
This circumstance makes it possible to identify a person in a typical computer system, where everyone is equal, and the fact of the transaction and other news is available to everyone, without deciphering the details of course. Thus, trust arises through total distrust.
And if the liability system works perfectly, therefore, the services of banks and notary lawyers are not needed. The fact is that each user has a public and private key.
Using the private key, a unique cast of the document is created and sent to your partner, who can quickly check whether you can sign the submitted document correctly. Such working conditions in the crypto world give one essential, necessary quality – it is impossible to renounce a signature.
Paying off with cryptocurrency, we fully trust each other: the client is the manufacturer of goods or services and vice versa since new mathematical technologies guarantee security. Control is carried out through smart “smart contracts.” The worst thing that can happen in this situation is the loss of these electronic keys.
specific features of cryptocurrency
Today, cryptocurrency is already a recognized means of payment, like euro or USD. Meanwhile, there is one crucial circumstance that distinguishes it from other types of monetary units. According to the idea of a particular unknown person or group of people who created this new technology on October 31, 2008, at 14 hours 10 minutes New York time, only 21 million coins will be issued – bitcoins – and not a coin more.
It follows that those who jumped even on the bandwagon of this high-speed train, rapidly rushing into the future, have already won and are confident that in the future their dividends will increase a hundredfold. Who did not have time, he was late?
Mysterious birth of a new currency
Some mystery in the latest history of the emergence of cryptocurrencies, such as bitcoin and ethereum, does not allow most people to fully accept the original conditions of the game in the modern world. This mystery is an unknown person, either the Japanese Satoshi Nakamoto or nameless Americans who or who created an anonymous currency and introduced it to web sites, cannot but alarm. Nevertheless, the most advanced representatives of humanity were not at a loss.
The story of success
As statistics show, those businessmen who knew the rules of the game on the stock and currency exchanges, realizing that the price of any currency, including digital, is determined by its demand, became millionaires. Now they can advertise bitcoins to the starters. Prices are changing rapidly:
- For the first time in October 2009, one dollar could buy 1309.03 bitcoins;
- In July 2017, for one bitcoin you needed to pay 2363.96 dollars;
- December 31, 2017, this figure was – 13 thousand dollars.
Moreover, in 2020, bitcoin will cost three times more than gold, said a well-known expert in this field, Cliff High.
The first crypto millionaire
One of the first buyers, and now crypto-millionaires, was an American named Smith, who became rich two years after college, working as a software developer in one of the largest companies in Silicon Valley.
In 2010, according to google, he acquired 20 thousand units of cryptocurrency at 0.15 dollars per bitcoin and sold them at 350 dollars a week. Thus, the novice programmer earned $ 2.3 million, and after a while, the total amount of his winnings was $ 25 million!
Having received such wealth that he, as he told in an interview with reporters, would be enough for the rest of his days, Smith quit his job, and for several years he has been traveling continuously on his plane and does not deny himself anything. Honestly, this guy was born with a golden spoon in his teeth.
By the way, he expresses concern about speculative cryptocurrency prices. However, his virtual account still has a thousand bitcoins in stock, and the young millionaire plans to exchange it when the price rises to 150 thousand dollars for bitcoin.
The main secret of success
Currently, not loners, but an increasing volume of people working in groups and large companies are investing in cryptocurrency. By purchasing it, they are insured against inflation, which can be subjected to “paper” world currencies. Miners follow the wise rule – “do not store all eggs in one basket.” It is even more important than the knowledge of theory and the ability to use the Dow Jones index in daily trading and to analyze the charts.
The government’s attitude
While the current legal system for mining and cryptocurrencies does not even have terminology, the method of issuing this currency has not yet been described in the legislation of Russia. Therefore, what is not prohibited is permitted?
Meanwhile, cryptocurrencies are destroying sources of replenishment of the budget, because it’s miners do not pay taxes since banks do not take part in obtaining interest from transactions in the virtual world. And this circumstance cannot but excite the authorities. The state, like a substantial clumsy machine, is only gaining momentum in this direction.
National law projects
In December 2017, deputies of the State Duma of Russia for mining, as for illegal entrepreneurship, were going to give eight years in prison. And recently, the head of the Bank of Russia Elvira Nabiullina spoke from a high rostrum that a national cryptocurrency would be created. At this historical economic crossroads, everyone can choose whether it is good, whether it is personally profitable for him to engage in cryptocurrency mining or not.
What is the cryptocurrency for people
For most people, storing their savings in cryptocurrency is nothing more than a new way of investing, along with gold and real estate. For some, cryptocurrency is a significant contribution not only to today’s day but to the future.
After all, relatively recently, the existence of a smartphone, and contactless payment for services was a curiosity. And today, a professional holiday of all miners has already been announced – May 22 (Bitcoin Pizza Day), when one American for the first time paid with cryptocurrency for two boxes of pizza.
In conclusion, it is worth saying a few words about the cryptocurrency exchange. This is the principal place of work for any trader dealing with btc or eth. It is here that you can make speculative transactions by placing orders for the purchase and sale of crypto coins while analyzing the charts.
Therefore, it is high time to choose the best cryptocurrency exchanges to start trading. Choose cryptocurrency exchanges that:
- Regularly provide payments to users;
- Do not delay transactions;
- Provide good account security, including necessary guarantees;
- Have enough cryptocurrencies in the trading list and many trading pairs.
Beginners should not pay attention to little-known exchanges (although they have their advantages). Unpopular crypto exchanges and markets always have a high chance of going bankrupt. And if this happens, then no one will return your deposits.
Your main task is to learn the basics of trading, understand and feel how to trade cryptocurrency and gain relevant experience, and not immediately get the maximum profit from the first day of trading. Choosing trusted exchanges that have already gained popularity in the cryptocurrency market, you can get the minimum necessary experience in cryptocurrency trading without any risk of falling into any fraud. That is why, at the initial stage, it is worth giving your preferences to the most popular and most significant crypto exchanges.