With so many options out there to invest in, it can get overwhelming when the time comes to make your choice. You can go the safe route and invest your savings in a relatively stable commodity like gold, which, although it will keep your money secure, is unlikely to earn you more of it in the long run.
A second option you have is to invest them in the stocks of a company. This can undoubtedly pay off in the future, but it can also be a risky move to make. Namely, these stocks’ prices can easily be manipulated by a dedicated group of people for their interest.
We saw this clearly during the GameStop trading fiasco in January. Reddit users of the popular social media website managed to revive a failing company from the dead just by buying up its stocks en masse and artificially increasing the demand for them. Follow this link to learn more: https://www.washingtonpost.com/business/2021/01/27/gamestop-amc-reddit-short-sellers-wallstreetbets/
A choice that can ensure your savings’ safekeeping while providing you with the opportunity to get rich while basically not doing much is cryptocurrencies. You might have heard of these revolutionary new concepts, and of course, it was only a matter of time before we even moved money online.
However, for a lot of people, the process of how electronic currencies work can get confusing. As much as we have gotten used to credit cards, many of us still prefer the tangible feel of cash in our hands. There is no need to panic, though! We have got it covered. Stick with us as we explain in detail the inner workings of cryptocurrencies and how you can use them for your benefit.
A step-by-step guide to the world of electronic money
The simplest way to envision how cryptocurrencies work is to think of them as chips usually given in casinos. You use “real” currency to buy them, after which you are given a unique code in place of a bank account number. This code is deliberately made to be unbreakable and even uses technology used in World War Two to ensure that no one but you can access your units.
Now, you might ask yourself: but if there is no bank, where are my units stored? That is a great question! The way cryptocurrencies maintain the units is through a technology named blockchain. This technology is essentially dispersed across computers worldwide that manageand record transactions with cryptocurrency units. Read more about it here.
You have probably heard of the term “crypto mining.” This phrase is what is used to refer to the process of verifying the transactions between users and recording them in the so-called public blockchain ledger. Just like you can see your transactions on your banking app, so can the sender or receiver users see it on the register.
Crypto mining is also responsible for a crucial part of cryptocurrency circulation. Namely, this process allows for the creation of new coins that then enter the current flowing supply. It works on the same principle as the Bureau of Engraving and Printing and the United States Mint, which produce banknotes and coins, respectively.
However, the difference between crypto mining and the government’s currency production is that any third party does not oversee the former. In fact, the introduction of new units to the circulating supply is only possible through its users’ efforts. A consensus logarithm also known as Proof of Work,ensures that every user contributes proof of the amount of computational energy they used to create new units.
Advantages to choosing a cryptocurrency
The most significant benefit to using cryptocurrency instead of regular old money is avoiding things like overdraft fees or interest rates that banks love increasing from year to year. Unfortunately, these costs can sometimes be responsible for your balance plunging into the negatives, so it is best to dodge them in the long run if you can.
Moreover, cryptocurrencies make the transaction of money more straightforward than ever! Sure, you can send any amount of money you want to your family on the other side of the world, but through traditional means, it can sometimes take a full work week, and it will likely cost way more.
Another reason why you should go for a cryptocurrency is its discreetness. Unlike bank accounts which, when you open them, require your ID, social security number, and credit checks, cryptocurrencies are much harder to link to your identity and do not require any proof of it to buy some. A lot of people think of this as a red flag. Still, this inconspicuous approach has helped many survive, from abused partners looking for financial stability to targeted activists in repressive governments.
Lastly, cryptocurrencies are way more accessible than other fiat currencies. Because they rely on the internet, you can send and receive bitcoins from your PKT wallet with only a smartphone or computer. This is primarily an advantage for those living in locations without access even to old-style banking systems.
A brief overview
So, what is the verdict? If you ask us, buying units in any of the newly emerging cryptocurrencies is an absolute no-brainer! If the way BitCoin blew up is any indication, there is more to come from where that came from, and it shows no signs of stopping. The future is here, and it is up to you whether you will participate in it.