What are Cryptocurrencies?
Cryptocurrencies are actual currencies that are backed by a technology called a blockchain. These technologies transact in their native currency instead of fiat currency (government backed money). The currencies pay the network to perform work on the blockchain. These currencies can be traded with Bitcoin, Dollar, Ether and some other monies. Many places are strictly accepting Bitcoin now as payment, which is pretty cool. Its like McDonalds giving you a Happy Meal for a thin slice of gold.
What is a blockchain?
This is pretty geeky so bear with me…
A blockchain is a whole bunch of computers, all around the world working together to solve problems. They solve all kinds of problems, the Bitcoin block chain solves the problem of how much money (bitcoin) do you have? If you get a wallet (more on this later) and you add Bitcoin to that wallet, that balance will stay on the block chain until your balance changes, then that also will be stored on the blockchain. This happens by all of these computers running the Bitcoin Algorithm verifying your transaction. When its verified the block is closed and can never be changed or deleted. So your money is safe because thousands of computers say you own that Bitcoin.
Other networks work in the same way but they do actual work, the Ethereum blockchain for instance, performs validation of “smart contracts”. With a small program you can write a contract and when that contract is verifed complete you will have completed that task and you will be paid by the Ethereum blockchain.
More in a video HERE
Why are they important and worth so much?
Blockchain technology will help solve a myriad of issues in our societies that are difficult to solve and are in-trenched within them.
- Ownership of property
- Fast and very accurate financial transactions
- Micropayments that would otherwise be meaningless to do due to fees
This technology being a source of truth is paramount to the blockchain, if it says you own your home. You own it. There is no argument about it. Because the data is forever and no one can change it or delete it unless otherwise written in a contract. The makers of the blockchain cannot change any data on the blockchain, nor can the transactors. If they do make a change there is a record of that change. Every single transaction will be on the blockchain and will be there forever.
Whats next?
Well you need to decide if you think you should put some money to work, you can buy a few of the best currencies and technologies out there. Or you can speculate and buy some very small cap coins and hope they go to the moon. Please go through our site and we will walk you step by step through the process of purchasing, holding and selling your cryptocurrencies. Have fun!