We must learn about cryptocurrencies. Like it or not, they are becoming more important every day. We are at a point where it is impossible to ignore its progress, more are the number of people who are hearing about this technology. And to think that it all started ten years ago with the launch of Bitcoin (BTC), the first cryptocurrency. In this guide, we share everything about Cryptocurrencies that you need to get started this year, 2021!
The number of doors that this digital money can open for us is innumerable. That is one of the main reasons why at Techshali.com we are also concentrating on educating our readers about the world of cryptocurrencies because sooner or later, there will come a time when we will need to use them. But we want to go much further than that, in this technology, there are many opportunities that we can take advantage of, all we need is knowledge. The moment has come to set foot inside this world.
We are not going to delve much into the history of the creation of BTC, this article is more directed so that we can understand what cryptocurrencies are, how they work, and what is their objective. Knowing all this, we will be able to see the great scope they have.
Let’s start with the simplest question we can think of.
What are cryptocurrencies?
They are a digital currency, which is generated through encryption techniques in order to verify transactions completely independently. A cryptocurrency does not depend on any banking entity.
It is time to begin to familiarize ourselves with the term “decentralized”, which is defined as something totally free from all kinds of governmental and private control, it is one of the main characteristics of a cryptocurrency. It is totally public, and its price will be reflected in the trust and functionality that its users see. Something that we must be clear from now on is that any type of digital currency that is controlled by private or government agents cannot be considered a cryptocurrency.
These currencies can be used as a payment method, it is even possible to exchange one cryptocurrency for another. But how is this digital money generated? That is thanks to people we can call miners.
Miners: the cryptocurrency generators
It is very important to know who the miners are and what their job is. As already said, mining is the method by which cryptocurrencies are created, but at the same time, it is the process by which transactions are completed in a decentralized way. Everything happens through a peer-to-peer or p2p network between the miners that make it up, this help to complete the computational processing, through the resolution of algorithms, necessary in the Blockchain. Once they complete each operation, the miners receive a small commission in the same cryptocurrency.
And before we go running to find out how we can mine these coins so that we can be paid with them, we must take into account something very important. Mining is a process that involves the use of good equipment, we must have computers with powerful processors, not to mention the possible energy costs.
But there is no need to worry because this is not the only way to obtain cryptocurrencies, there are better, cheaper, and very smart options, all we need is something very essential: knowledge.
Well… what is the Blockchain?
The Blockchain, or Chain of Blocks as it is also called, is the technology that is making all this possible, therefore it is a concept that we cannot ignore. And it is nothing more than the large database that records all the information of a cryptocurrency, payments, transactions, changes, any type of operation is registered in the Blockchain. And once something is recorded on the blockchain, it is impossible to change, it stays there, visible to public view, because yes, the Blockchain is also transparent.
These are just some of the basic concepts that will help us understand what cryptocurrencies are and how they work.
Let’s do a little summary
- Cryptocurrencies are decentralized, they are not controlled by any government or private entity.
- They may have real market value.
- They are generated by solving algorithms.
- The Blockchain is the ledger where every operation that is completed in it is recorded. It is totally transparent.
Some of the best-known cryptocurrencies
There are currently more than 1500 cryptocurrencies, some are much more profitable than others. They all have different prices since this varies for each one according to the confidence that people have in them, this is closely linked to their potential and the use that can be given to them. It is very important that a cryptocurrency has a solid use.
These are some of the most popular
- Bitcoin (BTC)
- Bitcoin Cash (BCH)
- Ethereum (ETH)
- Litecoin (LTC)
- EOS (EOS)
- Stellar (XLM)
- Monero (XMR)
- Bitshares (BTS)
- IOTA (MIOTA)
- Dash (DASH)
- Ripple (XPR)
It is incredible how all this technology has advanced in the last ten years, since the departure of Bitcoin. The investment opportunities that this world can offer us are practically endless. But we must remember, we are talking about a new subject, and like all subject matter, it must be studied. The world of cryptos, as they can commonly be called, must be studied carefully, because just as the gains are, so will the losses.
But we will talk about all that later. The objective of this article was to introduce us to the basics. At Techshali we share the vision of many regarding this digital money and we want everyone to be able to know and understand it.
We will not wait for opportunities to knock on our door. You have to go through that door and look for them. Knowledge and information can always move us forward. Do you dare to try cryptocurrency transactions?