Crypto is a digital currency used to buy goods and services online. You can even buy a palladium-plated hardware Birkin bag using crypto.
What makes cryptocurrency interesting and intimidating to some is that it uses cryptography to secure and verify transactions. Cryptography is the process of converting a simple text into a complex combination of letters and numbers. A transaction made with cryptography can only be opened with a ‘password’ or private key that the sender and the receiver only knows.
The use of crypto is legal in most parts of the world. Here are some of the countries that support the use of crypto:
The United States of America
The United Kingdom
The Czech Republic
Aside from being legal in most parts of the world, it also blurs the line between borders. This is one of the reasons why casino cryptocurrency sites like Gamdom are among the hottest trends. You’ll have a fun time betting because the use of crypto made depositing funds and withdrawing winnings easier.
Crypto works similar to a credit/debit card, the only difference is that an algorithm processes each transaction instead of banks or financial institutions. All of the transactions are also recorded on a public distributed ledger called blockchain.
Since banking institutions have no control over cryptocurrencies, their value does not depend on the country you are in, it is based on supply and demand. If there is a higher demand than the supply, the value of the coin will increase. This is one of the reasons why Bitcoin (BTC) is the most expensive coin in the market.
Basic crypto terms you should know
Before you join the crypto market, it is highly recommended to know the basics first. This is to avoid confusion and losing a huge amount of money in the long run. To give you an idea, here are some of the most used terms in the market:
Mining in the crypto world does not mean that you need to go to the mountains and look for Bitcoin. Mining is the process of adding new coins to the market. This also includes the process of recording and making sure of the authenticity of each transaction.
Bitcoin address is a combination of letters and numbers that represents a destination on the network. It is only used when sending and receiving BTC and is meant to be used once. Reusing your Bitcoin address does not guarantee the safety of your funds, it is better to generate a new one. After all, you can generate a new BTC address with just simple clicks.
Crypto wallet is where you can store, send, and receive coins. Think of it as your bank account. The only difference is that you have full control over it. Each crypto wallet is also given a unique account number and wallet address that will protect you from hackers and fraudulent activities.
A private key is a form of cryptography that gives you access to Bitcoin and other coins. Think of it as the key to your mailbox. Once a mailman drops a letter in your mailbox, only you can open the mailbox using the private key.
Altcoins are alternative cryptocurrencies aside from Bitcoin. Although it has the same characteristics as BTC, they differ in mechanisms, speed of mining, algorithms, and block size.
Here are some of the widely used altcoins in the market:
Block is where crypto transactions are permanently recorded. These are ‘automatic’ ledgers wherein once a block is full and approved by other miners, you will be redirected to other blocks. It also links all of the information and transactions made like a chain. This is the reason why it is called the ‘blockchain’.
Among the most notable features of blockchain is that it is open to the public. However, it is impossible to hack because it is made with a complex series of letters and numbers. If someone will attempt to do so, they will need special equipment and in-depth knowledge of how blockchain works. This ensures security and transparency in the system.
A pool is not where you get to swim and flaunt your strokes. It is a network of miners who work together to mine crypto. Once mining is successful, the miners split the block rewards equally to themselves.
A block reward is given once a block has been successfully mined. It is a gift after adding coins or blocks to the system. Most of the time, it can be BTC or any coin offered by the system. A block reward is one of the best ways to encourage miners to increase their productivity.
Double spending is actually a flaw in the system which means that you can spend your money twice. It is commonly done by hackers by duplicating the transaction you made to earn a profit.
Hashrate describes the speed and computational power when mining. Simply put, it is the speed of mining measured in units of hash/seconds. Since crypto guarantees faster transactions, the average hashrate is around 10 minutes only.
A peer-to-peer transaction is a process of sharing information between two people without any third party. It is any information that only the sender and receiver have access to. P2P transactions are one of the reasons why crypto transactions are faster and cheaper.
The digital signature is one of the verification processes to secure your coins. It is also recognized as one of the main keys behind the protocol of Bitcoin. However, make sure that you have your private key because you cannot create a digital signature without it.
Also known as initial coin offering, it is a crypto event wherein a project is launched allowing or encouraging users to invest in them. ICO is a popular method of introducing new coins in the market or blockchain-based platforms. It acts like a ribbon-cutting event in the crypto world.
Here’s why you should use crypto
Have you ever wondered why the popularity of cryptocurrency is continuously increasing even though it is highly volatile? This is because you can use crypto to buy anything under the sun or easily deposit funds and withdraw your winnings at Gamdom.
Aside from using crypto to buy anything you want or to deposit funds to your gaming account, here are the other advantages of using crypto:
Cheaper and fast transaction
You no longer need to worry about taking a huge chunk out of your wallet because crypto transactions are cheaper. Since it is decentralized the transactions are not controlled by the government or any central authority, the funds are also directly sent to the receiver. This also means that you don’t need to wait for 3 to 5 business days for the amount to reflect in your account.
When using a credit/debit card, the transaction will be recorded alongside your personal information and is made available for the banks. The only advantage is that you can check the balance and keep track of your spendings with the so-called statement of account released by your bank. This can be useful for business transactions.
Using crypto almost works the same way but only the amount and the crypto address is shared. Even though the transactions are recorded on the blockchain, your personal information is encrypted. This is why you just need to scan the QR code or provide your crypto wallet address when making a transaction.
One of the best features of crypto is that you are the sole owner of the private and public encryption keys. The ownership can only be transferred once the transaction between the sender and the receiver is done.
Once the transaction is done, there is no way to reverse it. This is to prevent hackers from entering the system. So, with every transaction, make sure to provide the correct crypto wallet address.
Top 5 coins in the market
With cryptocurrency being one of the hottest talks of the town, there is no doubt that more coins are introduced in the market. Some are made for investment and trading purposes while some are made exclusively for blockchain-based platforms. Believe it or not, there are more than 4,000 coins in circulation right now. Here are the top coins you should keep an eye out on:
Bitcoin (BTC): The first cryptocurrency
Aside from being the first cryptocurrency, it is also the most valuable coin with a limited supply of 21 million coins. BTC was also developed by a pseudonymous Satoshi Nakamoto in 2009. There were a lot of investigations made to find out who the real Satoshi Nakomoto is but the person behind him remains a mystery.
One of the reasons why several people prefer investing in BTC even though it is the most expensive coin in the market is that it can be easily traded to traditional currency such as the US dollar and Japanese yen. With the main purpose to serve as an alternative to traditional currency, several companies are slowly integrating the use of BTC.
Ethereum (ETH): The second-largest coin
Ethereum has the most active blockchain technology. With the increasing number of ETH blockchain users, Ethereum 2.0 was released in late 2020. It aims to replace all servers with a worldwide system of nodes for faster transactions. For fast but smooth transactions, it uses a proof-of-stake (PoS) consensus mechanism that replaces miners with transaction validators. The PoS also allows the validation of block transactions depending on the number of coins the validator has.
Among the best features of Ethereum is that it has an open-source network and smart contract feature that allows users to develop decentralized applications or dApps.
Litecoin (LTC): Early Bitcoin spinoff
Litecoin is recognized as one of the fastest coins because it can finish transactions within 2.5 minutes only. LTC has also a larger supply of coins than BTC with a total of 84 million coins. Aside from a larger supply of coins, Litecoin is easier to mine because its algorithm is much easier to work with and does not require several special types of equipment.
It might be impossible to believe but Litecoin was initially released as an early Bitcoin spinoff. This is one of the reasons why Litecoin is nearly identical to Bitcoin.
Bitcoin Cash (BCH): A fork of Bitcoin
Bitcoin Cash is a fork of Bitcoin that aims to solve blockchain’s scalability by increasing the block size from Bitcoin’s 1MB to 32MB. This is for BCH to process more transactions at a much faster rate while still maintaining a cheaper fee. Aside from ultra-low fees, there are no chargebacks.
Tether (USDT): Top stablecoin
Unlike other coins mentioned above, Tether is a stablecoin backed by US dollars. This simply means that 1 USDT is equivalent to 1 USD. Since it is backed by a traditional currency, it is easier to trade and is less volatile.
Tether is also the world’s first stablecoin with the main purpose to remove price volatility in the crypto market. Since it is less volatile and much more flexible compared to other coins, several private individuals and companies are willing to invest in USDT.
What’s great about cryptocurrency is that its value continues to increase even though the market is highly volatile. However, it is still best to learn more about the basics of using crypto before joining the market.
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