Cryptocurrency is a digital currency designed to provide a medium within exchanges. There are currently over 2000 cryptocurrencies out in the market today. With this being said, Ethereum is currently the heir to Bitcoins recently developed empire. These cryptocurrencies have seen a steady stock until 2017 when the world saw it’s dividends rise over 100%. However, today, the downfall is nearing.
Cryptocurrency introduced blockchain technology to the internet with the intent to decentralize currencies. The goal was to allow users to use their money freely, without the control of the government. In a decentralized network like bitcoin, the blockchain is essentially a public ledger available to basically everyone which brings me to miners. Miners are people who solve the cryptography of the transactions to record and ensure the legitimacy of it. Once a miner solves this “puzzle” they will receive a reward as well as the transaction fee. To date, miners can make up to ten dollars a day with everyday household equipment.
It is known that Cryptocurrencies are a high risk investment. Many people have made a fortune with this and many… not so much. The reason it is such a high risk investment is because the market value is extremely unstable and fluctuating everyday. Another reason being is that cryptocurrency is somewhat unregulated, meaning it can be outlawed or hacked at anytime. For storing purposes, many major exchange companies offer an outlet for this. However, your safest bet would be to store your assets in a offline wallet in your hard drive which gives you full control over all of your assets. Investors also need to worry about the taxes. Generally, long term trading of cryptocurrencies can be taxed up to 15%.
The rise of cryptocurrencies came very quickly and there has been any questions about its legality. Governments across the globe have outlawed cryptocurrency due to the many cases of fraud. It is currently legal in the United States but that can change at any second.