What's a Cryptocurrency?

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Bitcoin isn't the first cryptocurrency to emerge, but the pre-Bitcoin experiments have all failed. Mention may, in particular, be made of DigiCash, CyperCash, and E-Gold.

Cryptocurrencies were popularized thanks to Bitcoin and its creator: "Satoshi Nakamoto". There are now several tens of thousands of them, and the vast majority will disappear or die; their value in dollars (or euros) will reach 0, and no one will develop the project.

They are also given the names of virtual currencies, crypto-assets, electronic currencies, or digital currencies. The second most famous crypto is Ethereum, with its symbol ETH. Each cryptocurrency has its symbol (ticker in English), that of Bitcoin is BTC.

What is a Cryptocurrency? It is an asset that is traded peer-to-peer (P2P) without trusted third parties such as banks. They have no physical medium such as coins or banknotes, are not regulated by a central body, and are not indexed to the dollar or gold.

What is a cryptocurrency

These new electronic money make use of blockchain technology to move the ownership of cryptos in between their various proprietors. These cryptocurrencies are, consequently, just sequences of numbers whose possession is moved from someone to an additional. It is now feasible, thanks to cryptos and also the blockchain to move value on the web!

Cryptocurrencies are not money because they are also volatile, not required to be approved by traders as well as not considered as a shop of value. That recognizes, that may well alter quickly. In 2017 and 2018, cryptocurrencies experienced an extraordinary boom with strong popularity for fundraising or ICOs. Raising crypto funds permits any person throughout the globe to purchase a task.

Currently, the fundraising trend in cryptocurrencies has actually lowered; nonetheless, the market capitalization, primarily BTC, remains to increase. More than 460 billion bucks for Bitcoin on December 26, 2020. At the start of 2021, we exceed the limit of the trillion (1000 billion) dollars of capitalization of all the bitcoins in circulation.

Financial institutions are increasingly interested in it with many investments from specialized funds and companies. Central banks are also doing it through CBDCs or MNBCs for Central Bank Digital Currencies.

Some big groups like Facebook, a GAFA, have tried to launch their own crypto: Libra, renamed to Diem, but which has received a lot of critical feedback from states. They had to change the way their cryptocurrency works and postpone its launch.

These are the developers, known or anonymous, who develop and develop these digital assets. They choose the properties of the latter: the number of tokens or coins in circulation, the speed of transactions, the reliability (security) of the network.

It is possible to change the rules in certain exceptional cases. These changes can lead to the creation of new crypto. Thus, Bitcoin split and gave birth to Bitcoin Cash on August 1, 2017.

New crypto-assets are made through a mining process, and people agree to lend computing power to secure the cryptocurrency and are thanked with a reward. To find which cryptocurrency to mine, you will find more information in our section dedicated to mining.

The main crypto currencies:

  • Bitcoin
  • Ethereum
  • Tether
  • Binance Coin
  • XRP
  • Cardano
  • Dogecoin
  • Litecoin
  • Bitcoin Cash
  • Solana

While some countries like El Salvador are making bitcoin a national currency, other countries like China are blowing hot and cold and announcing from time to time specific bans concerning exchanges or bitcoin miners. Still, others like Pakistan, Algeria or Morocco prohibit them completely.

The main goal of most new cryptocurrencies is to solve the problems of the previous ones. We can, for example, cite Litecoin, which aims to make faster money transfers than with Bitcoin. Ethereum, which specializes in the development of smart contracts, or decentralized applications.

Or a whole bunch of cryptocurrencies that aim to increase the number of transactions per second on the blockchain. Other cryptos like Ripple (XRP), Monero or, the French, Tezos can be mentioned.

The majority of cryptocurrencies use blockchain technologies although other technologies can be used.

If you want to acquire crypto-currencies, whether, for investment or trading, we advise you to do your research beforehand. To find out everything, we have written dozens of articles that allow you to invest safely or fully understand these new assets' value. Once you own cryptos, you will need to store these virtual currencies. On this subject, we also have several articles (which you will find below) which will explain how to keep them safe.

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