What is Cryptocurrency and Blockchain?

March 27, 2018

Here are the Wikipedia references for both cryptocurrency and Bitcoin

 

cryptocurrency (or crypto currency) is a digital asset designed to work as a medium of exchange that uses cryptography to secure its transactions, to control the creation of additional units, and to verify the transfer of assets.[1][2][3] Cryptocurrencies are a type of digital currencies, alternative currencies and virtual currencies. Cryptocurrencies use decentralized control[4] as opposed to centralized electronic money and central banking systems.[5] The decentralized control of each cryptocurrency works through a blockchain, which is a public transaction database, functioning as a distributed ledger.[6]

 

Bitcoin, created in 2009, was the first decentralized cryptocurrency.[7] Since then, numerous other cryptocurrencies have been created.[8] These are frequently called altcoins, as a blend of alternative coin.[9][10][11]

 

Now here is a much more comprehensive and entertaining explanation provided by John Oliver.  (Warning: Adult Language)

 In my own research, I found Coinbase to be a legitimate site where you may purchase, store, and trade Bitcoins and other high-value cryptocurrencies such as Ethereum and Litecoin similar to an ETrade account. There are many other exchanges, but Coinbase seems to enjoy the first mover advantage. My understanding is that it is safer to hold your cryptocurrency in a digital wallet rather than leaving it on an exchange like Coinbase.

 

 

In terms of cryptocurrencies, I am a keeping my eye on XRP / Ripple, but at the time of this posting, the only way I could purchase XRP was through another ETrade style trading site called Kraken and the process was very convoluted. Kraken looks to be legit, but their customer service was so bad I was unable to complete the transaction and it took the company 45 days to respond through their online support so... that kind of scared me off.

 

So, my advice is the same as John Oliver's advice on Cryptocurrency and its underlying technology blockchain, be cautious. The technology is here to stay, but the currency and their exchanges are still very much wonky at this point and linking accounts with your bank is just not yet feasible for the masses. It is an exciting technology and God knows I'd like to put Western Union out of business when I send money internationally, but converting cryptocurrency to actual currency that is easily spent is still a bit off in the distance.

 

Do the research. If you want to throw down $100 on a cryptocurrency just to be "in the game" go ahead so long as you can afford it, but be prepared to lose it. 

 

Caution is the best advice before rushing out to join the #HODLEGANG.

 

 

 

 

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