Hello, fellow Steemers, Ihave recently learned and posted a lot about Cryptocurrencies, but I have never really discussed how they work and what they essentially are. Today I am solving that issue by posting this guide on everything you need to know about Cryptocurrencies.
What are Cryptocurrencies?
Cryptocurrency is a form of digital money that is designed to be secure and, in many cases, anonymous.
It is a currency associated with the internet that uses cryptography, the process of converting legible information into an almost uncrackable code, to track purchases and transfers.
What are Altcoins?
The word “altcoin” is an abbreviation of “Bitcoin alternative,” and thus describes every single cryptocurrency except for Bitcoin. Altcoins are referred to as Bitcoin alternatives because, at least to some extent, most altcoins hope to either replace or improve upon at least one Bitcoin component.
Most alt coins just about Bitcoin clones, changing only some characteristics such as transactions speed, distribution method, or hashing algorithm.
How cryptocurrencies work
Cryptocurrencies use decentralised technology to let users make secure payments and store money without the need to use their name or go through a bank. They run on a distributed public ledger called blockchain, which is a record of all transactions updated and held by currency holders.
What is an ICO?
An unregulated means by which funds are raised for a new cryptocurrency venture. An Initial Coin Offering (ICO) is used by startups to bypass the rigorous and regulated capital-raising process required by venture capitalists or banks. In an ICO campaign, a percentage of the cryptocurrency is sold to early backers of the project in exchange for legal tender or other cryptocurrencies, but usually for Bitcoin.
What is mining? Can I do it?
In simple terms, mining is the process of confirming transactions and adding them to a public blockchain. In order to add a transaction to the blockchain, the “miner” must solve an increasingly-complex computational problem (sort of like a mathematical puzzle). Mining is open source, so anyone can confirm the transaction. The first “miner” to solve the puzzle adds a “block” of transactions to the blockchain.Anyone can be a miner, but the most powerful computers earn the most.Also take into consideration not all Altcoins can be mined.
Should I invest in Cryptocurrency?
Cryptocurrencies are rising at an exponential rate against traditional holdings like the dollar and the FTSE 100. The question everyone wants an answer to: can it last? What’s going on? Is it sustainable or will the bubble burst?
You should rigorously analyze before investing, and when you are sure what Cryptocurrency you want to buy, go for it.But never invest money you don't have as Cryptocurrencies are extremely volatile.
Thats all for this post, thanks for reading!! If you enjoyed or learned something new pleas upvote and follow Self-steem for more!!
