Monday, May 20, 2024

Everything You Need To Know About Cryptocurrency

The word cryptocurrencies have burst into force in the last two or three years. We hear it regularly in the media and specific areas of knowledge, especially in the fields related to finance.

However, there are few people who so far could clearly define what they are exactly, how they can be used and, above all, what types of benefits are those that they supposed to their carriers.

In what does seem to be a high consensus is that it is virtual money, that is, we cannot touch it or smell it, but at the same time, it has infinite possibilities of use.

In other words, it is a natural product of the times of digitalization, Big Data, the development of new technologies, and the impulse of new types of world trade.

Many understand it as the logical step after the consolidation of virtual money, which at the time was an innovation more or less similar to that generated by cryptocurrencies. Do you remember how you felt the day you first paid for a product with your credit or debit card?

The Most Frequent Doubts About Cryptocurrencies And Their Use:

More and more people are interested in the use of cryptocurrencies. The vast majority of them are attracted to the possibility of trading with this type of money and obtaining medium or long-term benefits.

Experts say that although it is not very clear what its operation is or the means to acquire them, its use will be practically widespread in a couple of years, as it happened with virtual money or even with other technological tools such as the appearance of Email or mobile phones.

In this first phase of cryptocurrency development, it is logical that many doubts and concerns arise in this regard.

Best Cryptocurrency Wallet

Therefore, on this occasion, we want to contribute to more detailed, practical, and useful information. Check out some of the most frequently asked questions when we talk about these currencies:

  • When did the first cryptocurrency arise?

Bitcoin dates from 2009, and since then its evolution has not stopped. The concept, its uses have been defined, and a market for its trade has been opened, which is now continually expanding. But not only that: Bitcoin, as a precursor currency, has given rise to many other cryptocurrencies that are currently seeking to gain a foothold.

  • How Is Trading With Cryptocurrencies?

The idea of the matter is that you exchange your real money for cryptocurrencies and then use them to make transactions. There are two types of users: the investor, who is the one who buys cryptocurrencies with the hope that their value increases in the medium or long term to sell them later and obtain benefits; and, on the other hand, the agent, which is the one that deals with changing one type of cryptocurrency for others, for example Bitcoin for Ether or vice versa.

  • Where Does The Trade With Cryptocurrencies Happen?

Trading with cryptocurrencies takes place in the virtual market, specifically in a spectrum similar to that of the Stock Exchange. That is where they are assigned a transfer price and movements with this currency occur.

  • Who Issues Cryptocurrencies?

In this first phase of development, cryptocurrencies have no restriction to be issued. Any agent or user can create their own and put it on the market to trade with it. However, it is not ruled out that, in the future, financial institutions and private banks will assume this task to guarantee more significant support for the investments made.

  • How Much Is A Cryptocurrency Worth?

Nobody knows it for sure. Its value varies in the same way as that of the shares in the Stock Exchange, because it depends on many factors. To give you an idea, 1 Bitcoin was worth 13,000 euros on December 27, but a week later its value had fluctuated between 15,000 and 9,000 euros.

It’s almost like a bet or a dice roll. Many finance specialists point to this circumstance as one of the main risks of cryptocurrencies, to which piracy and scams also add online.

The Petro: Cryptocurrencies Backed By States:

Recently launched the Petro, the cryptocurrency with which the Venezuelan government aspires to mitigate the economic crisis facing its country and open up to new relationships and transactions in the global arena.

The Petro is defined as one more cryptocurrency, although in reality, it has a series of characteristics that make it different from the rest.

For example, it is a virtual currency that does have the backing of Venezuelan state institutions, which are responsible for its issuance, control, and intervention. That is, it is not in the hands of individuals. Apart from that, its support is the barrels of oil that the country produces and exports to destinations such as the United States or Europe.

With all that, some critics of this measure point out that there is still a lot of work to shape the new currency and at the moment they qualify it as a new version of the debt bonds that the country acquires annually.

However, Venezuela is not the only country that has begun to probe this type of options. Also, nations like Russia or Turkey currently value the creation of a cryptocurrency similar to Petro. There is even talk that China, given its essential role in today’s world economy, has begun to consider it.

Teodora Torrendo
Teodora Torrendo
Teodora Torrendo is an investigative journalist and is a correspondent for European Union. She is based in Zurich in Switzerland and her field of work include covering human rights violations which take place in the various countries in and outside Europe. She also reports about the political situation in European Union. She has worked with some reputed companies in Europe and is currently contributing to USA News as a freelance journalist. As someone who has a Masters’ degree in Human Rights she also delivers lectures on Intercultural Management to students of Human Rights. She is also an authority on the Arab world politics and their diversity.

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