An Overview Of How "Crypto" Currencies Like Bitcoin, Ethereum, and Ripple Operate

Crypto, also known as "cryptocurrencies," is a category of software that allows users to transact over the Internet. The system's decentralized nature, which is typically provided by the blockchain database system, is its most crucial component.

Blockchain and "crypto currencies" have recently become significant components of the global zeitgeist; typically as a result of the skyrocketing "price" of Bitcoin. As a result, millions of people have entered the market, putting enormous strain on the infrastructure of many "Bitcoin exchanges" as demand has skyrocketed.

The most crucial thing to understand about "crypto" is that, despite having a real use (facilitating international transactions over the Internet), it offers no other financial advantages. To put it another way, its "intrinsic value" is strictly constrained to the capacity for interpersonal exchange and NOT in the storing or disseminating of value (which is what most people see it as).

The most crucial thing you need to understand is that payment networks like "Bitcoin" and similar concepts are NOT "currencies." The most crucial thing to understand about "getting rich" with Bitcoin is that it simply refers to the act of being able to purchase the "coins" for a higher price. This will be covered in more detail in a moment.

Networks for decentralized payments

As previously stated, it's important to keep in mind that "Crypto" is primarily a decentralized payment network. Imagine Visa and MasterCard without the centralized processing infrastructure.

This is significant because it reveals the real motivation behind the increased interest in the "Bitcoin" proposition: the ability to send and receive money from anyone in the world as long as they have your Bitcoin wallet address.

Due to the misconception that "Bitcoin" will somehow enable you to make money by virtue of being a "crypto" asset, this assigns a "price" to the various "coins." There isn't.

Buying the "coins" for a low price and selling them for a HIGHER price has been the ONLY way that people have been able to profit from Bitcoin. It was actually based on the "greater fool theory," which essentially claims that if you are able to "sell" the coins, it is to someone who is a "greater fool" than you. Nevertheless, it worked out well for many people.

This means that if you want to get involved in the "crypto" space today, your best bet is to buy any cheap (or inexpensive) "coins" (including "alt" coins) and ride their price increases until you decide to sell them off later. None of the "coins" are supported by tangible assets, so there is impossible to predict when, if, or how this will work.

Future Growth

In all actuality, "Bitcoin" is a defeated force.

While its price will probably rise into the $20,000+ range due to the epic rally in December 2017, purchasing one of the coins today will essentially be a huge bet that mass adoption will take place.

The majority of "alt" coins, such as Ethereum, Ripple, and others, have a low price but are steadily increasing in value and adoption, and the smart money is already paying attention to them. The way the various "platform" systems are actually being used is an important thing to consider in the contemporary "crypto" space.

With a focus on how they're able to give users the ability to actually utilize "decentralized applications" (DApps) on top of their underlying networks to get functionality to work, Ethereum & Ripple are looking like the next "Bitcoin" in the fast-paced "technology" space.

This means that if you're looking at the next stage of "crypto" growth, it will probably originate from one of the many platforms that you can already identify.