A cryptocurrency is a form of digital currency that had been created with the help of technology. Through advanced encryption techniques known as cryptography, the backbone for cryptocurrency was created ten years ago. Since then, it has evolved into a globally widespread phenomenon. Those who’ve had friends or family members who have tried investing in cryptocurrencies also want to get a piece of the action. It is, therefore, no surprise that cryptocurrencies are labeled as the future of currencies and the global currency exchange market.
What is it precisely about Cryptocurrencies that has made it the major success it is today? Why is every trader becoming interested in it? How is cryptocurrency changing the future—and even the present—of money, trading, and investments? Read more below to find out answers to these common questions.
- It Is So Popular Because It Is Decentralized
If you have been in the currency exchange industry for long now, you would know that all currencies across the globe are centralized. Each state has its central bank, and all these central banks also report to one World Bank. This is where the concept of legal tender comes in. With cryptocurrency, however, there is no central institution that regulates it. You control your market, as the demand and supply levels are dependent on how the current market exchange in cryptocurrency is doing.
This is advantageous to many, as it now forms part and parcel of how cryptocurrency has become quite a major success. With many more individuals getting into cryptocurrency, these investors have also made the market stronger and less volatile. Remember, with lesser demand also means that the overall pool of money is also smaller. With such a low level of cryptocurrency in which the market moves, this is where the danger starts to come in. But because it has become so popular in recent years, there are more investors coming in, which has also strengthened the cryptocurrency market.
In addition, the fact that it is also decentralized gives investors more freedom to trade. Because a central bank doesn’t control them, cryptocurrencies aren’t affected by any global political or economic issues that might otherwise adversely influence it. It is only the digital market that is affecting cryptocurrencies. The process of obtaining cryptocurrencies, such as mining, is also easier than having to go with a central bank. Checkout mintdice.com here to learn more about mining for cryptocurrencies.
- It Is Relatively Easy To Use
One of the most common misconceptions about cryptocurrency is that it is only for those who are very well advanced in their knowledge and skills in trade and investments. This is false. Many have, in fact, noted that cryptocurrency trading could sometimes also be easier and less confusing than the usual forex exchange. How is this made possible?
With cryptocurrencies, you can choose to trade in two ways. The first is in the manual form of trading, which is very much like how you do it with forex trading. If you are already an expert, then many can choose to go this way. But for beginners, there is a better alternative, and this alternative is one of the reasons why cryptocurrency trading has become so popular.
Because of technology, there are also numerous applications and software present today that allow you opt for an automated form of trading. This means that the trading bot or the software does all the work for you. Based on a predetermined and pre-created algorithm, this algorithm is what is used to read the ups and downs of the global economy to help find the best investment strategy for your Bitcoins. All you have to do is spend at least half an hour each day setting your parameters, and together with the algorithm in place, the trading software performs the work for you. It’s as easy as that.
- Its Price Is Always Increasing
When you are trading, you will likely feel more encouraged to trade when the value of one commodity or dollar increases in exchange. For instance, you have US dollars that you would want to change to Philippine pesos. If the exchange is low, supposing 1 US dollar is equal to 51 Philippine pesos, you try to wait it out a little further so that you can have more Philippine pesos. When this rises to 1:55, then surely, you trade more US dollars for your peso.
This same example works with Bitcoin trading, and it is also one of the determining factors why cryptocurrencies have become so successful over the years. Take a look at these values:
- In early 2017, Bitcoins opened up at 1 Bitcoin is to 775 US Dollars.
- In mid-2017, Bitcoins increased to 1 Bitcoin is to 2,000 US Dollars.
- At the end of 2017, Bitcoins increased to 1 Bitcoin is to 15,000 US Dollars.
This spike in values has caused the popularity of cryptocurrencies, making it one of the most highly demandable commodities in trade.
- It Is Used For Many More Purposes Than Before
As cryptocurrencies continued to increase in popularity, its uses have also become more widespread. From the usual trading and exchange factors, cryptocurrency is now used for many other purposes, including entertainment. There are now hotels in Dubai and Miami that accept cryptocurrencies as a form of payment. There are airline-booking apps that also accept Cryptocurrencies. Imagine buying property overseas through the use of Cryptocurrency—it’s now possible!
These numerous uses and even many more have also contributed to the widespread popularity of cryptocurrencies.
When cryptocurrencies first came to this world, no one was sure of what the outlook would be. But what was previously labeled as the future of currency exchange has also influenced the present. While there is still much debate about the reliability and stability of cryptocurrencies, there is also no denying the fact that it has become quite a major success.
For many, it is a chance of striking while the iron is hot. Putting in a few dollars, sometimes as low as 250 US dollars, doesn’t hurt, while you make it rise to its peak. At present, it is predicted that cryptocurrencies might make a whopping 1 Bitcoin is to 20,000 US Dollars mark by the end of the year. Imagine this exchange. Others are timely enough to withdraw the increase before prices go low again. As long as you know how to play the game in currency exchange, you can be one of those who have used cryptocurrency to their maximum advantage to earn a fortune.