How “Crypto” Currencies Work – A Brief Overview of Bitcoin, Ethereum and Ripple

“Crypto” – or “crypto currency” – is a type of software system that provides users with transactional functionality over the Internet. The most important feature of the system is theirs decentralized nature – usually given block chain database system.

Blockchain and “crypto currency” have become the main elements of the global zeitgeist lately; usually due to the rise in the “price” of Bitcoin. This has led millions of people to participate in the market, as many “in exchange for Bitcoin” were experiencing severe infrastructure tensions as demand rose.

The most important point to realize about “crypto” is that even if it actually serves a purpose (cross-border transactions over the Internet), it does not provide any other financial benefit. In other words, its “intrinsic value” is firmly limited to the ability to interact with other people; NO value when storing / spreading (which is what most people see).

The most important thing to note is that “Bitcoin” and the like payment networks – NOT “currencies”. This will be worked out in more depth in a second; the most important thing to realize is that “enriching” with BTC is not the case to give people a better economic situation; it’s just a matter of being able to buy “coins” for a low price and sell them higher.

To do this, when looking at the “crypto”, you must first understand how it works, and where its “value” really lies …

Decentralized Payment Networks …

As I said, the key to remembering about “Crypto” is primarily a decentralized payment network. Think Visa / Mastercard without a central processing system.

This is important because it highlights the real reason why people have begun to delve deeper into the “Bitcoin” proposal; gives you the ability to send / receive money from anywhere in the world as long as they have your Bitcoin wallet address.

The reason why this “price” is attributed to different “currencies” is because “Bitcoin” will somehow give you the ability to make money by being an “crypto” asset. It is not.

The ONLY The way people make money with Bitcoin has been due to its “rising” price – buying “coins” at a low price and selling them MUCH higher. Although it worked well for many people, it was actually based on the “theory of the greater fool”; basically if you get to “sell” the coins, it’s to a “bigger fool” than you.

This means that if you want to participate in the “crypto” space today, you are basically looking to buy any “coin” (even “alt” coins) cheaply (or cheaply) and walk on them. the price goes up until you sell them later. Since not a single “coin” is protected by real-world assets, there is no way to calculate when it will work.

Future Growth

For all intents and purposes, “Bitcoin” is a spent power.

The December 2017 epic rally marked a massive adoption, and while its price is likely to continue to rise in the $ 20,000 range, buying one of the coins today will essentially be a big bet for this to happen.

Smart money is being studied in most low-priced “alt” coins (Ethereum / Ripple, etc.), but they are constantly growing in price and adoption. The main thing to look at in modern “crypto” space is the way in which different “platform” systems are actually used.

Such is the space where “technology” is fast; Ethereum and Ripple look like the next “Bitcoin” – focusing on how they are able to actually use “decentralized” applications (DApps) on their underlying networks to achieve functionality. wool.

This means that if you are looking at the next level of “crypto” growth, it will almost certainly come from different platforms that you are able to identify.