Cryptocurrency is in the news a lot these days. But few people really seem to fully understand how it works. Much like the only thing that gives the dollar or a bar of gold value is the decision to adopt it as currency being widely recognized, the same is true of cryptocurrency. Gold is used due to its limited quality. The basis for cryptocurrency is strong mathematics that backs a decentralized process that is impossible to cheat or take advantage of.
What are the Risks of Cryptocurrency?
Like any tangible currency, the value can decrease or the currency can become unpopular or no longer accepted. It is also true that Bitcoin and other such cryptocurrencies are based on computer software code, which can be hacked or modified. However, the lifespan and principles which these currencies are built on makes hacking them or counterfeiting them almost harder than counterfeiting actual currency.
Here are a list of risks associated with cryptocurrency:
- Spoofing payment information and phishing
- Hacking a payment gateway
- User address error
- Loss of a wallet file
- Insecure ICOs
- Spoofing a user address
Most common cryptocurrencies?
The most common cryptocurencies are Bitcoin, Litecoin and Ethereum. Bitcoin is the original crytpocurrency which was created and released in 2009. A very similar one which have proven secure is Litecoin. Litecoin is faster than bitcooin, which means transactions are confirmed quicker and its lower level of complication means that you don’t need shared massive processing power to mine for new coins. Ethereum is similar and uses platform-specific cryptography tokens, giving develops the ability to decentralize and trade just about anything.
Popular Crypto Currencies:
How to store Crytpocurrency
Cryptocurrency is basically just computer files that have been verified. Although they can be stored in online cloud-based systems and used from there. It is always safer to keep them offline, disconnected from the internet. Secure USB drives – or “hardware wallets” – help you keep your files safe and offline. One best practice is to upload a small amount to a cloud service or app which you use to make purchases. Much like we don’t carry our life savings in our actual wallet, its not prudent to carry your full balance out into the Internet either.
Popular Bitcoin Wallets:
- Bread Wallet
- Green Address
Why Is Bitcoin’s Value So Volatile?
Bitcooin is a hot topic right now. That means – just like the stock market – consumer opinion can impact how it’s viewed and adopted. Bad press can make it seem scary and slow it form maturing. There are also matters of tax treatment, adoption or lack thereof by the various countries using Bitcoin. All of these factors cause the value to fluctuate wildly much like a start-up company’s IPO.
Only time will tell how crytocurrencies will change the world. There is always power in knowledge. Sign up right now and keep learning everything you need to know about crytpocurrency and how you can keep your cryptocurrency secure now and in the future.