Among the many things that have changed in the past decade, cryptocurrency is undoubtedly on the list. However, even though cryptocurrency was created in 2009 to spread control over money, it still took a long time for most people to accept and use it.
As of May 2020, the market cap for digital currency is estimated to be around $265 billion. In addition, over $6 billion in transactions are made daily using Bitcoin, the most widely used cryptocurrency on the market.
This shows that cryptocurrency has managed to get past many people’s doubts. Despite this, many investors still need to learn about crypto because they want to enter uncharted territory. Those who want to join the world must do so with the necessary information.
Here are the most important things you need to know about cryptocurrency.
1. Purchasing Cryptocurrency is Not Hard
When delving into cryptocurrency, one of the first things people worry about is understanding the mechanism of purchasing and selling cryptocurrencies.
But it’s more complicated than it seems. Various sites are available dedicated to purchasing and exchanging digital coins. One such digital exchange is CoinBase. Furthermore, thanks to the introduction of digital wallets, people can keep their cryptocurrencies open at all times.
The private key that certifies ownership of the digital asset is kept in these wallets on the device. Popular crypto wallets include KeepKey, Binance, and Electrum.
You can use the same wallets to spend your digital currency. The process is the same as when you use other online payment services. Enter the recipient’s information and the money you want to send.
2. The Automotive Sector is Embracing it
One of the most lucrative sectors is the automotive industry. There is no such thing as the likes like the like, the like of the modo and the world’s published data, the number of ads, the taste of the like, and the number of acer as the like and the number of the Acer and the like. Also, by 2030, global sales will reach USD 8 billion.
The sector was among the first to take advantage of cryptocurrency opportunities.
Bitcoin and other cryptocurrencies are now accepted as a form of payment by businesses. So, if you have crypto reserves and wish to purchase from the available cars for sale, there are platforms you can complete the transaction from.
The auto sector is delving into blockchain in addition to using cryptocurrencies as a form of payment. Small businesses and major brands have used the decentralized network in solutions. According to a report from IBM, the technology will be used by more than 62% of the sector by 2021.
For example, CarVertical provides transparency regarding a car’s usage to ensure a fair deal in the used car market. On the other hand, Ford is looking for ways to connect cars and make traffic easier by using technology.
3. The Value of Cryptocurrencies Tend to Fluctuate
The value of cryptocurrency fluctuates, just like the value of stocks. The crypto market, however, experiences much more volatile volatility than stocks and securities.
The reason for the change is the same as for any other asset: supply and demand for the currency. The only difference is that since cryptocurrency is a decentralized currency, it lacks the stability that is provided by central banks, which manage and control traditional assets.
To illustrate how volatile the market is, let’s look at Bitcoin as an example. Bitcoin went from $13 to $700 in just one year. Then, over the next few months, it dropped to $300. The value then fell back to $3000 after reaching about $20,000.
This is also why the market is better for day trading than long-term trading.
4. Cryptocurrencies Are not Backed by The Government – yet!
While using cryptocurrency does have its benefits because it is decentralised and the blockchain network, like BSV DevCon, provides security, it is not for everyone. Still, the fact remains that the world’s governments still need to back the currency itself.
According to a report from the Library of Congress, countries like Vietnam, Nepal, Pakistan, and Algeria have banned the currency. The legal ramifications of using the money are the focus of governments’ warnings.
Since the government doesn’t ensure digital currency, it has different protections than fiat money in a bank account. For example, if the company that makes the digital wallet you use to store your cryptocurrency gets hacked or goes bankrupt, the government won’t help you get your money back.
However, according to Computer World, the Federal Reserve analyzes the potential of introducing a central bank digital currency. Fintech firms and the banking industry support adopting a government-backed cryptocurrency. Such is the case with Protego Trust, a federally chartered crypto-native bank that is among the most heavily regulated in the world.
If it indeed is adopted by mainstream banks and backed by the government soon, the pitfall of security can be avoided.
5. Cryptocurrency is Disrupting Various Sectors
When you think of cryptocurrency, you immediately consider how it will change the banking sector. And while it is doing so, there are various other industries it is impacted or has the potential to move.
First, casinos have joined the bandwagon and now accept cryptocurrency as a form of payment. Bspin is a gambling platform that accepts bitcoin to serve people worldwide.
As seamless payments, quick agreements, transparency, and accurate tracking are ensured through blockchain, the supply sector is also being disrupted by technology. There are some cryptocurrencies made for the supply chain. This includes VeChain, Modum, and WaltonChain.
The multibillion-dollar gaming sector also has platforms that use blockchain to let players sell, buy, track, and trade in-game items using cryptocurrency. Some of the first platforms in the field were GameCredits, Enjin, and FunFair.
Ending Remarks
Despite its drawbacks and risks, cryptocurrency is slowly being adopted in industries. So, it’s essential to know the basics and the pitfalls.
Only time will tell if the currency will become more widely used.