Today, people conduct many of their payments online. Even people who are not tech-savvy use their credit cards to shop on the Internet, and they usually access their bank accounts online. However, some people decide to explore the world of online money even further with cryptocurrency. This kind of money exists solely digitally, although many companies allow users to exchange their cryptocurrencies for cash. There are many types of cryptocurrencies, and they are all designed for a specific purpose.
Some types of cryptocurrency function through larger companies that handle transactions between many clients. Most allow customers to store their money securely and both pay bills and accept payments. A payment gateway can handle multiple types of cryptocurrencies. Some also require people to add information about their regular checking and savings accounts.
Perhaps the most famous and popular cryptocurrency is Bitcoin, which debuted in 2008. You can mine for Bitcoins by having a computer run complex calculations with a set of data, but it takes a long time to earn Bitcoins this way today. You can also accept them as wages or buy them, but their value has increased since their beginning. All Bitcoins are stored electronically and are based on a code that is assigned to each one. While some people are afraid of having their money stolen, for the most part, Bitcoin is reasonably secure.
Most cryptocurrencies use Bitcoin as their model, but there are newer alternatives for people who do not think they can break into the expensive and already-established world of Bitcoin. Zcash began in 2016 and has the option to encrypt the transactions conducted using this currency. It also offers a more private blockchain for recording transactions. Producing a blockchain is necessary so that people do not produce counterfeit cryptocurrency, but Zcash does not release as much information with it as Bitcoin does.
People may be more likely to trust Litecoin, since it has existed since 2011. Even those who are not involved in the development of cryptocurrency are beginning to accept it as payment. Anyone can mine for the tokens, and transactions usually occur faster than with Bitcoin. Additionally, the tokens are much less expensive so this cryptocurrency requires less capital for an initial investment.
Dash, which is a shortened version of “digital cash” and began as Darkcoin, is fairly popular. Transactions are much harder to track on this cryptocurrency and it has no central source. Like Litecoin, tokens are worth much less than individual bitcoins and are easier to purchase.
This kind of cryptocurrency from 2015 works slightly differently. People who want to conduct business can use Ethereum, which is a kind of software that allows secure transactions. Each token, known as an ether, allows the transactions to take place instantly and without the fear of theft. Some people use this currency to buy other types of cryptocurrencies. While the tokens are worth significantly more than those of companies such as Dash and Zcash, they are still much cheaper than Bitcoin’s.
Those who conduct transactions internationally should consider Ripple, which was founded in 2012. It does not involve a blockchain or mining, but still records all transactions. Some standard banks that have international business partners find it appealing since it works so quickly and allows them to be confident of payment without the hassle of in-person meetings. Tokens have a very low value, so a greater number is needed to effectively conduct business.
The world of cryptocurrency constantly changes. If you need a way to securely conduct business online, or if you simply want to invest your money in something new, you should explore the different kinds available. Keep in mind the fact that, as with all goods, the value of each token fluctuates. You will also need a certain level of comfort with computers and coding to become successful in the world of cryptocurrency.