Cryptocurrency for Beginners: A Guide to Understanding the Most Basic Ideas

If you know next to nothing about the craze that is cryptocurrency, you’ve come to the right place. Here’s the most basic guide on cryptocurrency for beginners.

If you’re curious about cryptocurrency for beginners, we’ve got you covered!

It can seem like a strange new world, riddled with risk to the uninitiated. But it’s also filled with opportunity – and that’s what’s got so many people intrigued.

What is Cryptocurrency Exactly?

Cryptocurrency is a digital currency. It’s an alternative to paper currencies such as the pound, the dollar, the yen and so on. It’s also known as a virtual currency.

Although it’s a virtual currency, it can be used just like a real currency to buy goods and services. Companies such as WordPress, Microsoft, and Shopify accept payment via bitcoin.

Digital currencies are underpinned by something called a blockchain. A blockchain is the backbone technology of the currency. It allows digital information to be distributed but not copied.

Using blockchain technology means that there is no need for a third party (ie a bank) to be involved in a transaction. This cuts fees for people using the cryptocurrency, but it also opens up questions about tracking fraud and even spotting terrorism and money laundering. Banks and financial institutions play a vital role in these issues nationally and internationally.

Cryptocurrencies are globally traded, and when volatile times hit real currencies, many people put their money into cryptocurrencies instead. For example, Bitcoin’s value rose over $100 in a day after the UK’s Brexit vote in 2016. Similarly when Cyprus’s economy crashed in 2013, people turned to Bitcoin rather than the volatile national currency.

How to Get Into Cryptocurrency for Beginners

If you want to understand how to get started with cryptocurrency, or get an introduccion a bitcoin, you’ll first need a wallet. This is a virtual wallet where you save the unique codes and passcode information of your cryptocurrency. You can buy these online, and then you can buy your bitcoins or other currency.

Not all banks allow you to purchase cryptocurrency with their debit or credit cards, so check that first. Paypal is another option to pay for your cryptocurrency investment.

If you wanted to experiment, bear in mind that you could lose your investment. It is a volatile market. If you’re looking at this because you’re interested in increasing your income, you might want to check out these alternative ways to make money online.

If You’re Wondering Which Cryptocurrency to Invest In

There are over 1400 cryptocurrencies available. Your choice will depend on your openness to risk. More established cryptocurrencies such as Bitcoin or Ethereum are probably more stable (but buyer beware, as always).

That said, there is still a lot of doubt and negativity around cryptocurrencies. Citigroup, Bank of America and others do not permit their credit cards to be used for cryptocurrency purchases. Respected leaders such as JP Morgan’s CEO, Jamie Dimon, have even called cryptocurrencies a scam.

It is a new industry, and is still evolving – so the risks and the opportunities are great. If you invest, you’d be wise to only invest what you don’t mind losing if it fails.

Other Money Resources For You

If you’re interested in cryptocurrency for beginners, you might also be interested to read our article on saving money by going cashless.