Hello guys, hope you are doing well today I will tell you about the Meaning of cryptocurrency. So get relax and enjoy this meaningful article.
What is cryptocurrency
Cryptocurrency is a digital currency that is untouchable, uncrushable, and virtual currency that acts the same as normal paper or coin currency. It’s a decentralized currency there is no role of govt. to regulate it or control cryptocurrency.
It’s the currency that will be used as the medium of exchange of goods and services, the same as money. This cryptocurrency can be published by a private person or private organization.
There is no role of governments to issue them, till now. Just like casinos have their token crypto is the same as that. To hold cryptocurrency you have to exchange it with your money issued by the government.
After knowing the meaning of cryptocurrency, the ques is “Is cryptocurrency is safe?”. So the answer is YES it’s safe to invest, trade, or use as a medium of exchange also because cryptocurrency uses blockchain technology.
Now there are two questions. The first one- Is cryptocurrency is legal because there is no role of government to issue crypto and the second one is- what is blockchain technology. So let me clear your queries.
what is Blockchain technology
It’s a decentralized technology used to record and manage transactions. It’s a secure and transparent technology that records and manages data in different computers server as blocks, every transaction has a different block. Each block gets to connect with an existing block which is made by past transactions.
Is cryptocurrency is legal
Cryptocurrencies are legal or not it depends on countries just like Cryptocurrencies are legal in the United States but China banned cryptocurrency. So it depends on the country to country that cryptocurrencies are legal or not. Weather peoples are showing interest in cryptocurrencies for investing and trading purposes.
Top 5 cryptocurrencies in the crypto market according to market cap.
- Binance coin
Why cryptocurrency is important
Cryptocurrencies are made for a specific reason that is the safe and secure online payment method. A virtual currency will represent by a ledger in the internal system. Cryptocurrencies are virtual so that is why there is no problem of a secure place to store money. Bank has different condition and risk also but when money store virtually there will be a surety of safety. Cryptocurrency works on algorithms.
There is power in cryptocurrency that it can make your money ten times or even more. If you invest money at the right time and in the right crypto, then it will be a bulls-eye for you so that you can become rich overnight.
To build trust in anything we need security no matter what it is. That’s why you can trust cryptocurrencies because they are highly secure.
And Blockchain technology makes it secure which I have already told about.
The transactions of cryptocurrencies are transparent. You can view any transaction and get information but cannot tamper with it which is a great benefit of cryptocurrencies.
Risk in cryptocurrency
Cryptocurrency is very attractive and most of the people with investing knowledge are engaged in the trading of crypto. Because crypto has the ability to give high returns but also has many risk factors which can give you negative results.
So, if you want to know everything about crypto so these are some important points you should know.
1 . Cryptocurrency is volatile
As I talk about cryptocurrency has the ability to give high returns and can lead to huge ROI Return On Investment but also cryptocurrency can give you heavy loss if you select the wrong cryptocurrency to invest and there are many other factors on which you have to focus before investing in cryptocurrency.
An unexpected change in market condition may lead to negative changes in the price of the cryptocurrency. The current situation is the best example of this risk because cryptocurrency is getting its price in minus(-) day by day.
2 . Unregulated currency
Cryptocurrency is not regulating by any banks and government but it is regulating by private persons or private organizations. There is no role of governments so there is no surety that they will be classified as a commodity or a virtual currency.
Recently, cryptocurrency gets the attraction of investors because they think that cryptocurrency will be the future currency and can be used as a medium of exchange.
But not a single country’s government assure that cryptocurrency can use as a medium of exchange. So there will be a risk of this cryptocurrency until any statement of government for cryptocurrency.
3 . Errors and hacking
No matter how secure the technology and digital things are there is always a risk of errors and hacking. Hacking is always a risk factor in every field of technology. There are lots of cases in which a single hacker hacks the whole bank data.
bank data is very secure and private still the hacker can hack the data of banks. And this is the reason for hacking risk in cryptocurrency.
However, blockchain is the very best and secure technology for cryptocurrency but in the end, it is a technology that can be hacked or can give you errors.
4 . Governmental issues
As I inform you above that cryptocurrencies are not regulated by any government so if there was an issue and illegal activities occur in cryptocurrency so the government can ban cryptocurrency and you have no option for it.
Because the government has no role in cryptocurrency so the government will not interrupt to give you some amount of loss in cryptocurrency you have to bear the loss with no reliability from the side of the government.
China banned cryptocurrency
Recently, China banned cryptocurrency transactions from financial and online payment companies and warn investors against crypto trading.
cryptocurrency prices took a change (sky to earth), and cryptocurrency trading has declined properly, severely undermining people’s property security and damaging the general economic and financial structure.
One statement said – China has banned cryptocurrency trading and initial coin offerings, but not holding cryptocurrencies.
It was China’s new attempt to face the bosting digital commerce market. After the ban, these institutions, including banks and online payment companies, will not offer their customers cryptocurrency to their customers. they are not able to provide services such as registration and trading. This emerges from three industry associations in a joint statement.
If you want to know how to invest in cryptocurrency then this will help you – how to invest in cryptocurrency