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Crypto Guide That Even Monkey Can Understand

Hello Crypto Griffin here, to teach all newbies some basics of cryptocurrency so you don’t end up like the small brain monkey as shown in image above.

What Is Cryptocurrency ?

Crypto is a digital asset or, more specifically, a digital currency. The elusive Satoshi Nakamoto created the first crypto coin, Bitcoin, in 2009, setting a precedent for many other cryptocurrencies (altcoins) to come into existence.

Traditional money, also known as fiat currencies, like US Dollars or Euros, are government-issued. This means political, economic, and even environmental issues can affect their value.

And what determines cryptocurrency value?

The cyber currency is valued based on demand, supply, and utility.

People and entities can transfer crypto via a technology known as ‘blockchain’. Therefore, banks and financial institutions don’t facilitate the transactions. Instead, anyone who holds or owns blockchain currencies can save it, send it to other users or trade it within seconds via simple, digital transactions.

How Crypto Works

Next in our Cryptocurrency for Dummies guide, we’ll look at the mechanics behind cyber money. But to understand how cryptocurrency works, you need to have some knowledge of blockchain technology.

Blockchain in layman terms is a decentralized public ledger or record of transactions. In some ways, the blockchain is like a database that stores information. However, this information isn’t stored in a single location. Instead, it’s held across a distributed network and available globally.

What Is Cryptocurrency Used for?

You can buy and sell cryptocurrency by exchanging it for fiat currency or alternative digital currencies, or you can send and receive crypto from one user to another. Similarly, you can buy cryptocurrency and hold on to it in the hope that its value will rise, and you can generate a profit by selling it at the right time.

In addition to this, you can now use cryptocurrency to buy goods and services from various companies instead of using cash or credit and debit cards. To get an idea of just how popular digital currencies are becoming, take a look at some of the businesses that currently accept digital money in the form of Bitcoin.

What Is a Cryptocurrency Exchange ?

A cryptocurrency exchange is a platform that enables you to buy, sell or trade digital currencies. When you use a virtual coin exchange, you can purchase crypto with fiat money and store it in a digital note wallet until you decide to use it. Alternatively, you can trade one virtual currency for another or sell your digital currency for fiat money.

If you want to sell, trade, or purchase cryptocurrency, you’ll need to get your own wallet and choose which exchange you want to use. Most cryptocurrency exchanges enable you to create a digital wallet straight away, although there are other options. For example, you can create a cyber wallet with another provider and transfer the funds directly. When you have set up a crypto wallet, you’ll be able to send and receive coins.

Once you’ve decided which cryptocurrency exchange you want to use, you’ll need to register. Some platforms require verification, which means you’ll need to provide a proven identity. Due to this, it can take hours or days to open an account. Then, you’ll be able to buy, sell or trade digital currency as frequently as you choose.

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Pros and Cons of Crypto

The benefits of cryptocurrency often outweigh the drawbacks. But to get a clear idea of whether it’s right for you, take a look at some of the pros and cons of electronic money:

Pros

  • Instant transactions
  • You can send coins worldwide
  • Zero or minimal fees
  • Secure transfers
  • Increased liquidity
  • Potential to deliver high investment returns

Cons

  • You can’t recover an already processed transfer
  • Unsecured and largely unregulated
  • High volatility makes cryptocurrency a high-risk investment
  • Not all businesses accept crypto

While different types of virtual currency may have their disadvantages, incoming regulations and backing from major corporations are helping to dispel some of the myths surrounding cryptocurrencies. As a result, they’re likely to become even more popular, with more companies accepting crypto payments and more people using digital currencies in day-to-day transactions.

Follow the guide above and avoid making newbie mistakes to avoid being a crybaby.