UNDERSTANDING CRYPTOCURRENCY
CRYPTOCURRENCY; WHAT IS IT?
Cryptocurrency is a form of payment that can be exchanged online for goods and services and it works using a technology called Blockchain. Blockchain is a decentralized technology that spreads across many computers that manage and record transactions. One of the things to consider while thinking about adopting this technology is its security. The security of cryptocurrency is reliable because it has been encrypted to provide a secured and faster means for transactions.
Cryptocurrency trading involves speculating on price movements via a CFD trading account, or buying and selling the underlying coins via an exchange. Most if not all individuals who venture into crypto-trading do so to make a profit and the mere fact that the volatility of cryptocurrency has to do with a lot of things, it has been illustrated that cryptocurrency volatility exhibits various reactions that bear resemblance to both currency pairs and store-of-value assets, bearing in mind an equivalent level of risk.
If you don’t believe it or don’t get it, I don’t have the time to try to convince you, sorry. — Satoshi Nakamoto
WHY IS CRYPTOCURRENCY WORTH ANYTHING?
On May 22, 2010, Laszlo Hanyecz made the first real-world transaction by buying two pizzas in Jacksonville, Florida, for 10,000 BTC, an amount that would be nearly $573,367,000.00 if held until May 9th, 2021.
The worth of cryptocurrency is linked to its value, and one major flexibility around cryptocurrency that makes it more valuable is the opportunity it presents; offers an efficient means of transferring money over the internet and it’s controlled by a decentralized network with a transparent set of rules, thus presenting an alternative to central bank-controlled fiat money.
Cryptocurrency has value because it can be used as a store of value and a unit of exchange for fiat money.
ITS CHALLENGES
Cryptocurrencies are volatile — this means that the value can either increase or decrease, hence entering into the crypto space without good knowledge on how to smartly leverage on this volatility can result in loss of assets. In addition, individuals who aren’t informed stand the risk of losing their assets if they forget their wallet details and since it’s decentralized, no government will be responsible for the retrieval of such assets.
The four major challenges facing crypto today; Government regulation, Issue of inheritance, Security risk, and Market risk. In summary, these challenges can be overcome with continuous improvement and adoption. Communities are emerging and platforms are introducing peer-to-peer transactions for their users, all these are strategies to improve trust and understanding of the market.
UNDERSTANDING THE MARKET.
Mike Novogratz stated in a publication with CNN that “ The cryptocurrency market cap has been projected to reach as high as $1–2 trillion in 2018.” Here we are in 2021, and it was announced in April how the cryptocurrency market cap has hit $2 trillion.
The cryptocurrency market is made up of Exchangers, Minners, and Consumers. These are the players in the market. Consumers buy or sell cryptocurrency on an exchange platform that has been provided to them by exchange companies like Binance, Buycoins, and others. These companies work with miners to make coins available for transactions.
Regulations and Cryptocurrency
Regulatory treatment of cryptocurrencies continues to evolve, but because the technology transcends global boundaries, the influence of national regulators is limited and since cryptocurrency is designed to avoid government control, it is uncertain how successful, government agencies would be in control. During a monetary council meeting, the CBN (Central Bank of Nigeria) governor stated that most cryptocurrency transactions are illegitimate.
Trading platforms are providing means to mitigate this challenge in the market by asking for KYC. If you should sign up with recognized Exchangers like Binance and Bitsamp, most of these platforms have documents that help them to verify their users by implementing the Know-Your-Customer (KYC) process.
Crypto Bootcamp
THE CRYPTO BOOTCAMP is a Blockchain and Crypto Education Community and Platform, with a special focus on Blockchain education, and the Global Digital Economy, which believes that educating people about cryptocurrency is a necessity.
I’m not sure if anybody knows exactly how emerging payment technologies are going to change the world for good in the long-term — I certainly don’t. But I’m convinced they are going to have a big, positive impact, and am excited about going on the journey. — I concluded with a quote by Richard Branson
