If you’re thinking about investing, starting to invest, or are already investing and want to diversify your portfolio and perhaps gamble at the idea of becoming an overnight millionaire, you’ve probably started to think about cryptocurrencies as an investment option.
Certainly, it’s hard to read the news, or scroll through your twitter feed without reading about it.
Maybe you’ve even put some money down on Bitcoin or Doge and watched it bounce up and down, in the last several months hoping it’s going to hit the promised higher levels.
But more likely, you’re hitting yourself over the head wondering why you didn’t buy crypto at the early stages when they cost fractions of a cent, at which point you’d be rich!
Today, a lot of financial news contains stories about crypto, predictions, and expert opinions.
So the big question, who’s right and how can you make the most money out of crypto?
On one side you have some of the smartest and richest men in the world putting their full weight behind crypto.
On the other hand, you have another one of the world’s richest men, Bill Gates, who according to Business Insider, isn’t bullish on bitcoin, and warned against jumping into the trade by saying that people who don’t have as much money to spare as Tesla CEO Elon Musk should watch out.
Government and central banks are also starting to clamp down on crypto and crypto mining, while other countries are accepting it with open arms declaring it legal tender.
Then there’s the question of “which crypto?” and “which one’s going to skyrocket next?”.
With so many cryptocurrencies available, and such a volatile crypto market, being new to crypto it’s important to answer the basic questions, such as “is crypto a good investment?”, “where do I start?”, and “will cryptocurrencies hold over time?”.
While all these are very important questions, to which you can probably find countless answers, let’s back this all up and answer this question:
What is crypto?
Let me be blunt, you’re not going to learn everything you need to know about crypto in a single blog post, so while there’s a ton to cover, let me back up and answer a more basic question: “what is crypto?”.
In its most basic essence, a cryptocurrency is a digital form of money that aims to decentralize currency.
The idea is that you are able to pay for online and also physical goods using cryptocurrency. Today, many companies are starting to warm up to the idea of accepting crypto, while others have already started.
According to Fundera, an online financial platform, as of December 2020, 2,300 companies across the U.S. accepted payment in the form of bitcoins, and upwards of 328,000 bitcoin transactions are processed daily.
Think of crypto as tokens in an arcade or casino chips. You can purchase them with dollars, and then use them within the arcade, or casino, to play. Well, in the real world and in the future, cryptocurrencies will be a common way to pay for everyday products and services.
Cryptocurrencies are created by complex computer programs and algorithms and are backed by a technology called a blockchain.
A blockchain is a technology that is spread across many computers. It manages and records every single transaction, in sequence.
While currently primarily used for cryptocurrencies, one of its most appealing features of blockchain is security. Blockchain technology can and will be adapted to everyday life transactions, products, and services.
Penny Millions
Editor, Sleepy Money
(570) 903-8960
info@sleepymoney.com