Six Common Questions People Have About Cryptocurrency

It’s safe to say that most people have heard about cryptocurrency, but that does not mean that everyone has an understanding of it. Cryptocurrency is essentially a new medium of exchange and counts as a form of real currency. There are various forms of cryptocurrency with Bitcoin being one of the most popular. If you have ever wanted to know how you can buy Bitcoin or any other form of cryptocurrency, keep reading to learn more about that and everything else you need to know about cryptocurrency.

What Exactly Is a Cryptocurrency?

As mentioned previously, cryptocurrency is a form of virtual currency that takes the form of coins that exist on a distributed and decentralized ledger called a blockchain. Since the initial launch of Bitcoin almost 10 years ago, cryptocurrency has expanded immensely. Cryptocurrency can be used to purchase goods online wherever a business takes crypto as a form of currency. The value of a coin all depends as these values go up and down on a regular basis, much like stocks do. However, the fewer coins are available, the more value each one will have.

How Can You Buy Bitcoin?

If you are interested in buying Bitcoin or just interested in the process, it is a lot easier than you might think. To buy Bitcoin, you will need a few things: a cryptocurrency exchange account, personal identification documents, a secure connection to the Internet, and a method of payment. You should also have a “wallet” to store your Bitcoin in.

Once you have all of these things, you can find a cryptocurrency exchange where you can buy, sell, and hold cryptocurrency. Next, you will need to connect your personal information and input your payment selection, typically a debit card or a bank account. After doing all of this, you simply select how many Bitcoins you want to purchase and the process is complete.

What Is Mining?

Mining is the term used to get tokens of cryptocurrency without actually having to purchase them. It is an incredibly difficult process that not many people can do and involves using your computer to perform an intensive series of mathematical problems needed to verify a “block” in the blockchain. If you are successful in solving the problems, you may be able to earn a token of cryptocurrency in exchange.

Is There a Risk Associated with Cryptocurrency?

Like with most investments, there is a small risk that comes with buying cryptocurrency. This is primarily because as mentioned before, the value of cryptocurrency is constantly up and down. Another issue is the fact that if someone were to steal your cryptocurrency, there would essentially be no way to track who did it nor would you be able to get it back. You can also fall victim to one of the many scams out there aimed at crypto enthusiasts that involves someone claiming to have created a new form of crypto, scamming you into buying into it, and then disappearing once they have your money.

Why Has Crypto Become So Popular?

One of the main reasons why cryptocurrency has become so popular, aside from the fact that it is a novelty, is because cryptocurrency transactions are usually processed in a matter of minutes, unlike bank transfers that may take days. There are also little to no fees involved when the transfer is done internationally. Another advantage to using crypto is that you can do so anonymously because any of your personal details do not get revealed during a crypto transfer.

Is Cryptocurrency Legal?

While cryptocurrency is legal in most countries, there are some that are excluded. China, Russia and Vietnam are opposed to the use of Bitcoin or other forms of cryptocurrency primarily because of the fact that they do not consider it a legitimate form of payment. Because of the fact that cryptocurrency isn’t regulated by any banks, there are no taxes on it—yet another reason why some governments are so opposed to cryptocurrency and its use in their countries.

Most recently, El Salvador has become the only country in the world to allow Bitcoin as legal tender.