What are cryptocurrencies and why should they matter to you?
There are those who say that it is the new gold and others who argue that it is nothing more than a bubble that will end up bursting.
Is it a subject that should matter to you? Of course!
What is a cryptocurrency?
An intangible virtual currency.
Currently there are several cryptocurrencies and each one has a different practical use (you can consult all the cryptocurrencies with their practical uses here), since each one seeks to solve very specific problems and needs.
Similarly, the type of algorithm and system used by cryptocurrencies can also vary from one to the other.
Surely you are wondering: and what is what brings value to these digital currencies? The confidence of its users! In addition, everything flows according to supply and demand, which is what really determines its value.
The 3 most popular or popular cryptocurrencies are Bitcoin, Ether and Litecoin.
In general, cryptocurrencies have 3 main characteristics:
- They are decentralized. This means that they are not governed or administered by any person, financial entity or government.
- They have international reach. It allows transactions to be carried out around the world through the internet.
- They use cryptography principles to guarantee the security of transactions. That is why they are called crypto Cryptography allows you to guarantee the authenticity of transactions and control the creation of new digital currencies.
What advantages do these 3 characteristics offer?
Security and control over your money. Transactions are secured by military cryptography. No one can charge you money or make a payment in your name.
Fast payments, everywhere and at any time. International transactions can happen even on weekends and much faster than what a bank would take (seconds or, at the latest, minutes).
Very low or no fees. Most cryptocurrencies allow you to send and receive payments at almost zero cost. Except in special cases, such as in minute payments, there are no fees.
Protect your identity. There is no credit card number that someone can use to impersonate you. In fact, it is possible to make a payment without revealing your identity, almost like physical money.