Cryptocurrency, the financial market 2.0

Cryptocurrency: the guide

Introduced by Bitcoin in 2009, cryptocurrency is a virtual peer-to-peer payment system . Bitcoin and other cryptocurrencies (700 to date) have no legal tender like other currencies or gold, but they are governed by the same paradigm as the financial system we know: know the supply and the demand regal assets.

After a decade passed in silence, cryptocurrency questions. In recent months, the media but also our policies are questioning because of the exponential growth of Bitcoin, its fluctuations, investments generated by individuals and professionals but also the lack of legislation.

What is bitcoin? What is cryptocurrency? Should we invest? How? We tell you everything below.

Invest in cryptocurrency

There are two main ways to get cryptocurrency.

First, you can use the cryptocurrency (the one of your choice) as a means of payment when buying a good or a service. Or, you can convert classic currencies into encrypted currency.

For the conversion of your currencies, know that it is possible to do so easily on various platforms such as Bitstamp, Kraken or Poloniex, for example. However, to convert to Bitcoins, you must register on one of these platforms and provide both a copy of your ID and a recent invoice as proof of address. This is how you can create a virtual wallet, useful for storing your cryptocurrency. Following this, it is necessary to call an intermediary (what is called a broker in English) or download software that makes payments.

Some tips for investing serenely in cryptocurrency

Before investing in the encrypted currency, it is necessary to understand the famous blockchain technology but also the main details related to each currency, including governance, but also the programming and validation system blockchain.

One must also take into consideration the limit of expansion which varies according to the currency. For example, Bitcoin is limited to 21 million Bitcoins (which makes it a rare cryptocurrency) while other encrypted currencies are in unlimited quantities.

Check and learn about the cryptocurrency that interests you, including a look at the developers who are the origin, investors, who pay the developers but also to the main function of this currency (it is specific to each).

With cryptocurrency, you can buy products and services on a daily basis.

Every day, the number of merchants and websites allowing the purchase via cryptocurrency grows. Thus, you can easily buy leather goods, computer equipment or even works of art with Ethereum.

You can also be paid, make a payment to a third party, without having to pay any fees. Fees related to transactions made with a credit card are non-existent, a real advantage for merchants.

Be careful, however, any investment, on the stock market as in cryptocurrency, is not without risk.

However, the cryptocurrency is not yet subject to regulation, is extremely volatile. Inflation, like disinflation, can be brutal. That is, the price of an encrypted currency can vary by several percent in one day. In other words, the value depends on the members and the speculation of the buyers. Indeed, a speculative bubble can quickly form, as for Bitcoin, and suddenly collapse. In addition, there is currently no technical means to know the real value of these currencies unlike the cost of a share price that is directly correlated to the turnover of a company.

Despite these risks, it must be said that the blockchain makes it possible to improve the traceability of the various transactions between members and to improve their security. The members are also anonymous to protect them from marketing capitalization of their personal data. Users thus see in the virtual currency, a future safe haven as gold currently is.