Whether it’s Bitcoin, blockchain, ICOs, ether, or other trading platforms – people are noticing the ruckus that cryptocurrencies (and their associated language) have made in the news, online forums, and even around the dinner table. Despite the excitement, many individuals still don’t understand what these terms actually signify. 

Cryptocurrencies have gone a long way, both in terms of technology and appeal, from their early days as safe havens for criminals and money launderers. For 2018, analysts predict that the total value of the cryptocurrency sector could rise to between $1 and $2 trillion. Cryptocurrency proponents argue that the underlying blockchain technology has significant potential in fields as diverse as healthcare and the media.

While some claim that cryptocurrency markets are overheated, others see them as the next step toward financial equality. They are the latest financial technology trend on the surface, but on a deeper level, they represent a revolutionary technology that threatens the very foundations of our civilization.

The advent of cryptocurrencies raises serious questions about the viability of the current financial system as we know it. What are the benefits and drawbacks of cryptocurrency, though? So how do you choose where (or if) to put your money?

Although cryptocurrencies are a new innovation (Bitcoin, for example, was founded in 2009), they are here to stay due to their many advantages. If you have the know-how, the crypto world has a lot to offer, from the possibility of large returns to the convenience of trading around the clock on a highly reliable and open network.

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Cryptocurrencies are fundamentally safe due to the blockchain technology that underpins them.

Cryptocurrencies’ main advantages aren’t directly related to the currencies themselves but rather to the systems that back them up. The blockchain is a well-distributed ledger that records all transactions that take place on it. A transaction recorded on a blockchain cannot be undone. Due to the distributed nature of the blockchain, no hacker will ever be able to access the entire chain at once, making the data contained inside it impenetrable.

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Cryptocurrencies may provide a hedge against inflation for investors.

Since cryptocurrencies are not backed by any government or central bank, their value fluctuates in response to global demand rather than local factors like inflation. However, what about the inflation of cryptocurrency prices? The market is stable, so investors can rest comfortably. Since the total supply of coins is restricted, there can be no runaway inflation. Inflation can be contained with this method, which is used by cryptocurrencies such as Bitcoin and Ethereum.

The cryptocurrency market is open 24 hours a day.

Cryptocurrency marketplaces, unlike banking markets, are always accessible to buyers and sellers. You don’t have to wait for the NYSE, NASDAQ, or any other exchange to open for the day to buy, sell, or trade cryptocurrency because coins are created, and transactions are recorded around the clock. With the impact this has had, traditional stock exchanges are considering extending their trading hours to include non-banking hours as well. So, crypto could be the finest option for those who are always on the move to make money when they’re not working.

Issues to Consider 

Yes, there is a lot of glitz, but is the future of cryptocurrencies really so bright? Let’s check over a few of the negatives. Some are simple to fix, while others are more involved, but it is worthwhile to consider them all.

• The value of your cryptocurrency investment may fluctuate wildly.

The value of a cryptocurrency can experience both dizzying highs (with related benefits for investors!) and horrifying lows. For that reason, it could be a risky bet if you’re looking for consistent profits. The cryptocurrency market is based on speculation, and its tiny scale makes it even more susceptible to price swings. As a result, the value of coins may fluctuate wildly, which is one of the main drawbacks of cryptocurrency.

The inability to scale is a major problem for crypto.

You’d be forgiven for assuming that digital currencies work at light speed, and, to a certain extent, they do. However, at a certain scale, they begin to have significant difficulties that make widespread adoption a challenge. Providers of cryptocurrencies like Ethereum acknowledge this is a problem, with the blockchain having reached “certain capacity restrictions” that reduce the speed at which transactions can be executed. Participants in the transaction may feel frustrated by this, and it may even result in financial losses.

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Which cryptocurrency offers the most return on investment, and why?

Unfortunately, there is no cryptocurrency that is head and shoulders above the rest. While this is ultimately a matter of taste, there are a few considerations to not forget. Consider how much you are willing to lose if the value of the cryptocurrency you are considering suddenly drops. Do you want to use the currency primarily as an investment vehicle, or will you also use it to make purchases? Is money the only motivating factor, or are you also interested in supporting a cryptocurrency that can make a positive difference in the world? Choosing the dominant currency in the market, Bitcoin is one option. It’s the first digital currency, and it’s amassed the largest database of any cryptocurrency.

Decoding Bitcoin: The Future of Cryptocurrency?

Bitcoin, also known for its shortened form of BTC, has many advantages. There can never be more than 21 million coins in circulation, it is unaffected by inflation, and its eye-popping values provide investors ample opportunity to create profit. Additionally, Bitcoin is the most frequently utilized cryptocurrency nowadays. Obviously, there are some negatives to this. The blockchain technology behind Bitcoin begins to slow down once the transaction rate reaches seven per second (a serious problem when compared to Visa’s throughput of about 1,700 per second!). As the most widely used digital currency, Bitcoin is a prime target for cybercriminals.

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