Is cryptocurrency finally getting the recognition it deserves to get in America?

Cryptocurrency Finally Getting the Recognition It Deserves in America

 

At long last, cryptocurrency might just be getting the recognition it deserves.

Banks in America are starting to jump on the crypto bandwagon, which could mean big things for the future of cryptocurrencies like Bitcoin, Litecoin, Ethereum, and Ripple.

It’s been a rocky road so far, with massive highs and lows, but it looks like the party might have only just begun.

There’s money to be made here – if you know what you’re doing, of course – and there are already plenty of people who have made fortunes as early adopters of this new currency wave.

 

The origin story of Bitcoin

The cryptocurrency was born 10 years ago when a person or group of people using the name Satoshi Nakamoto published a white paper describing it as Peer-to-Peer Electronic Cash.

In other words, Bitcoin can be used like regular cash online—anyone who has Bitcoin can send it to anyone else using Bitcoin. The network tracks all transactions and prevents people from copying their unique digital signatures.

The rules are agreed on by users who run software that powers its record-keeping and security systems. This is called mining because they are rewarded with new Bitcoins for contributing their computing power to maintain and secure the system.

 

What makes digital currency so valuable

If you ask a cryptocurrency enthusiast, they’ll tell you that it’s decentralized and secure. If you ask a cryptocurrency detractor, they might mention volatile prices, market fluctuations, and outright scams.

But what makes digital currency so valuable is its relative ease of use – anyone with internet access can open an account on an exchange like Coinbase or Gemini to buy cryptocurrencies using fiat money. So if you have $10 to spare, you can pick up $10 worth of Bitcoin instantly.

Digital currency also lets you bypass banks and eliminate transaction fees on global transactions; it’s effectively a way for consumers to transact on their own terms without restrictions from intermediaries.

 

Why should you invest

If you’re thinking about investing, but don’t really understand why cryptocurrency is a good investment, it may be time to do a little research.

You don’t need to be an expert in financial markets or blockchain technology—just learn about how cryptocurrencies are created and distributed, as well as their underlying value.

Once you understand what makes digital currency work, you can develop your own approach for evaluating if a cryptocurrency is worth purchasing. One thing that might help is thinking about cryptocurrencies as part of larger movements that are disrupting different industries.

For example, think of how other companies have been using blockchain technology (the record-keeping mechanism behind Bitcoin) to build more efficient marketplaces. What kind of disruption could crypto bring?

 

How to start investing

You don’t need a lot of money to start investing—in fact, an online broker such as Ally Invest offers $0 commissions for online trades. You can also check out Robinhood App, which allows stock trading for free.

As with any investment strategy, it’s important to understand how your investments are making money and monitor your portfolio's performance. In other words, treat investing like a business (because it is).

If you're not sure where to begin, consider speaking with a financial advisor who can help you create an actionable plan based on your goals.

 

A few tips on how to avoid losing your money

Although cryptocurrencies have grabbed headlines and caused a buzz, it’s important to remember that they are still relatively new to Americans. Cryptocurrencies shouldn’t be considered investment vehicles—at least not yet.

There is currently no oversight for these digital currencies, nor do there exist any guaranteed protections for users (beyond losing their money). As a result, it’s difficult to put your trust in these products.

In most cases, investors should only consider cryptocurrencies as speculative investments or assets—not long-term financial security. Here are a few tips on how to avoid losing your money

 

How is this different from the regular currency?

Bitcoin is great, but it’s far from perfect. The currency had a rocky start when it first launched, dealing with significant volatility issues as well as some security concerns.

But overall, it has succeeded. Bitcoin has proven to be one of the most lucrative investment opportunities for investors who are willing to take on its high volatility profile. But many investors want something more secure and less volatile: alternative coins (altcoins).

Altcoins are cryptocurrencies that are not Bitcoin; there are hundreds of altcoins out there today and each has its own specialty or niche.

There's no limit to how much money you can make investing in them; they have great potential to become just as successful—if not more so—than Bitcoin itself in time.

 

Alternative Coins To Consider Investing In

One of cryptocurrency’s primary values is that it is decentralized. This means there are many options for investors, as opposed to if you were to invest solely in Bitcoin.

These alternative coins offer great investment opportunities for traders who want to diversify their portfolios and aren’t comfortable putting all their eggs into one basket.

The three alternative coins we’ll be focusing on are Ethereum, Zcash, and IOTA. Each has its own unique value proposition, so let’s take a look at each individually.

As always, don’t let anyone force you into an investment decision without doing your due diligence first. Cryptocurrencies can fluctuate wildly in price and should not be considered an investment vehicle unless you have an appetite for and are willing to lose what you invest.

Even with those caveats, these could prove good investments over time given the right research and asset allocation strategy. If none of these tickle your fancy or interest makes sure to do more research online before making any financial commitments!

 

Conclusion

Let's face it. Cryptocurrencies are here to stay. The technology behind them is solid, and they'll continue to grow as a platform for digital transactions of value. Some cryptocurrencies have already made a name for themselves, such as bitcoin and litecoin.

Both of these coins still maintain relatively large mining networks that are used to confirm transactions and generate new currency through mining activities (for additional reading on mining, check out our feature on how to invest in cryptocurrency).

Newer coins like Etherium and XRP have made quite a name for themselves too. Ethereum was developed by an organization called Ethereum, which markets itself as a blockchain-based system that can be used as a ledger for smart contracts among other things.