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Understanding Cryptocurrency for Novices
To put it in simple words, Cryptocurrency is a new kind of digital money. You can quickly transfer the traditional non-digital currency money, including USD, digitally. Still, at the same time, it is not very much possible to see how digital currencies have worked. When it comes to digital currencies coming into the mainstream, you need to check how you can pay things electronically and just using traditional currencies. But when it comes to digital currencies, you need to check beyond technology. You can even claim as to who cares about the technology and what remains behind your money. All you care about is the money you hold in your wallet. The real issue is that we can have the current money systems in the world with many issues. The following are some examples, which you can even find on sites like – bitqt app website.
- The payment systems, including wire transfers and credit cards, have now become outdated. Thus there is a need for an alternative.
- In most cases, we can see a bunch of brokers and middlemen, including banks and agents, who get their commission while carrying out the transactions. However, these remain slow and expensive.
- We see a good growth of financial inequality that seems to be ground all over the world.
- As of now, we see 3 billion unbanked people have now accessed certain financial services. It seemed to have taken half of the population over this planet.
The solution to all these problems comes with the help of digital currencies. Therefore, most of the cases are addressed with virtual coins.
The Basics of Digital Currencies
You know how things move day in and day out, and several government-based currencies are reserved in banks. You would require an ATM or an internet connection to a bank that comes along with transferring the people. With several digital currencies, you can find several banks and other brokers along with intermediaries coming along. It is because we see digital currencies relying more on the technology known as Blockchain that remains decentralized. Instead, we see every computer working over the network, confirming the transactions.
Before you explore the basics of digital currencies, you should have a fair understanding and definition of money. The philosophy behind money is that it acts as a whole and thus acts like a chicken and egg kind of situation. To make money valuable to gain the currency should carry several features like enlisted below:
- First, a sizable number of people should have it.
- Second, all merchants and traders should accept the coins in the form of a payment option.
- Finally, society should trust its value along with making it pretty valuable in the coming future.
In the earlier days, when people traded without currency, they exchanged things of their choice. However, with currency, cash and credit cards, things changed, and the definition of money had a vital role in relying on the model and the money that keeps changing things around.
The other key is that changing money makes the transactions simple. One can find too many hassles when carrying out loads of gold bars that come from the nation and move ahead to the next and give the critical reasons with the cash that came. Then we saw people getting lazier and getting credit cards with the invention. However, credit cards seem to carry the money which governments can easily regulate. As we see the world becoming interconnected and concerned regarding the authorities, one can find things in the best shape.
Digital currencies can offer too many valuable options. You can find some fun facts now, and your currency comes from the government’s support, including the one from the US dollars, along with making it a fancy name, and the traditional money comes around you. For example, Fiat currency is often defined as a legal tender that acts as a coin and then comes banknotes that are seen given with the government.
If you look at the history of digital currency, the first one to name included Bitcoin. We first heard about it in 2009, and we have more than 10K of virtual currencies. Bitcoin came into the market with the idea of defying the challenges of recession. Satoshi Nakamoto is behind Bitcoin, and it acts like a P2P version of electronic money. As time passed, Bitcoin emerged as the oldest and most expensive digital currency in the world.