The cryptocurrency phenomenon is showing no signs of slowing down. And if you haven’t invested yet, it might be time to examine what Bitcoin and other forms of cryptocurrency can offer you. This article was written with savvy entrepreneurs in mind, and we’re going to start with a look at what cryptocurrencies are all about and how you can get involved. We’re also going to discuss some of the major cryptocurrencies, so you can decide for yourself which, if any, interest you.
What is a Cryptocurrency?
A cryptocurrency is a digital currency which uses encryption to regulate the individual units of the currency and to verify the transfer of that currency. Usually, these currencies operate outside of the world’s central banks. Many people consider this to be the money of the future, but only time will tell how just how big cryptocurrencies will become on the world stage.
How Can Entrepreneurs Get Involved?
There are two major ways for you to get involved with cryptocurrency trading. The first is to buy and sell cryptocurrencies. This often involves the use of hardware wallets and dedicated software and, of course, it requires you to find a buyer for any currency you may wish to sell.
The second method is to choose a reputable forex trading platform that gives you the opportunity to trade cryptocurrency via spread betting or contract for difference (CFD). This way, you don’t actually have to own any cryptocurrency yourself. Rather, you can speculate on prices rising and falling.
For an entrepreneur this can be a good choice as it allows you to leverage your investments, offering the potential forlarge profits. However, it should be noted that leveraging also presents the possibility of losing large amounts. Another advantage of spread betting or contracts for difference is that you can profit from cryptocurrencies whether they rise or fall on the market.
What Are Some of the Major Cryptocurrencies?
Bitcoin began its existence way back in 2008, which is the dark ages as far as cryptocurrencies are concerned. In fact, this is the grandparent of all the cryptocurrencies operating today and Bitcoin is actuallyconsidered to be the world’s first decentralised digital currency (meaning that it doesn’t requirea bank or official administrator). Bitcoin’s coins are created during the process known as mining, which uses computer power to make sure that the blockchain (record of transactions) is consistent and complete.Because of its popularity, Bitcoin is often the cryptocurrency of choice for successful entrepreneurs.
In 2017, Bitcoin underwent a hard fork – which is a rule change not considered to be legal according to the original rules. The result was the birth of Bitcoin Cash, a separate currency to Bitcoin. The difference between the two is that Bitcoin Cash has a larger block size and therefore a faster verification speed. What’s important to entrepreneurs is that it is a widely traded currency and therefore worth investigating.
Ripple is another of the major names in the cryptocurrency world.It is a real-time global settlement network used not only by individuals,but by many larger banking institutions. The way that Ripple works is through a consensus ledger which doesn’t need mining and allows users to make payments using encrypted transactions in fiat currencies (such as the Euro or Dollar) or Ripple’s own internal currency known as XRP. For entrepreneurs Ripple can be a good choice, because it is backed by so many banks and large financial institutions.
This cryptocurrency began as a slightly more secretive version of Bitcoin and it works on a decentralized system that makes transactions almost untraceable. Dash, like Bitcoin, relies on miners to create new blocks, but the currency also benefits from what are known as Masternodes which handle transactions. This two-level system is part of the reason why Dash is so successful. For entrepreneurs Dash could be a good currency to follow, because it has a strong backing from the tech community and is highly adaptable thanks to its Decentralised Governance by Blockchain (DGBB) system.
Launched in 2011 as a way of making it easier for ordinary people to get involved with cryptocurrencies, Litecoinis a peer-to-peer cryptocurrency with coins which are created via an open-source cryptographic protocol. Although it is like Bitcoin in many respects, Litecoin has a slightly faster transaction confirmation rate. Litecoin also implemented an anti-spam filter early on in its existence, which has helped to keep the size of the blockchain down – in fact, Litecoin’s blockchain is the smallest of all the major cryptocurrencies. These advantages, coupled with Litecoin’s unified community, make it an attractive choice for entrepreneurs.
There is much to learn and discover in the world of cryptocurrencies, and fortunately there is a wealth of information available online. So, now that you have read through this guide it might be worth arming yourself with more information and seeing how you as an entrepreneur can benefit from the cryptocurrency phenomenon.