So what is cryptocurrency? You may have asked at one point in your life and because of all the technical definitions people give it online, you might have dismissed it as another scam that’s bound to fail. Is cryptocurrency then digital money? Well, yes, it is. It is electronic money which means that it is virtual. It therefore means that it has equal value with PayPal and other card funds, right? Not exactly. Because it is not regulated by the central bank of any country and hence is not tied to their economy. More so, its worth is not fixated. That it is virtual though does not completely annihilate the possibility of a physical appearance. Bitcoin has a somewhat defunct variant of a physical coin. Cryptocurrencies offer anonymity, security and decentralization. While some call it a bubble, it is only a projection of stark ignorance and unfounded stereotypes.
Bitcoin is a type of cryptocurrency. Hence it is digital. It is also globally adopted as a means of exchange. It is built on the blockchain technology. The blockchain is a technology created to create, store, and manage digital transactions that are public, secure and distributed. It was created by a man named Satoshi Nakamoto to provide a way for people to make secure transactions without using a bank. These transactions occur between two people without the presence of middlemen. People buy it as an investment portfolio.
So why do people buy it? People buy it because unlike credit card funds, it can mature in value up to 10000% or more. The value increased from $500 to $16000 in just 12 months. And beyond all those, it offers security and anonymity. We all love flexibility, don’t we?
These are digital currency exchanges that are in the business of bitcoin trading. You simply trade assets or currencies (i.e. fiat or other digital currencies) for bitcoin. It goes both ways, either buy and sell bitcoins using fiat coins or altcoins. They are online platforms that act as intermediaries between buyers and sellers of cryptocurrency. They match buyers with prospective sellers and match prospective bitcoin sellers with corresponding bitcoin buyers. They make their profit off transaction fees. Registering on one is easy once there is a valid means of identification and verification.
Cryptocurrency exchanges differ from bitcoin exchanges only in versatility. While a Bitcoin exchange focuses on Bitcoin trading and selling alone. Cryptocurrency exchanges offer other cryptocurrencies different from Bitcoin.