All About Cryptocurrency Market, It’s Types, Price, and Working
Cryptocurrency is a digital currency that is used to buy goods and services like any other currency in the world. It uses an encryption algorithm “cryptography” to process secure digital transactions. Cryptocurrency is a virtual currency that means it does not have any physical representation. Bitcoin was the first cryptocurrency to be developed in 2008. The cryptocurrency market works on the technology known as “Blockchain”. One big defining feature of cryptocurrencies is that they are often not issued by any central authority. This technically makes them immune to government interference or manipulation.
Cryptocurrency markets are decentralized which means they are not regulated by any government body or financial institution. They are just processes on the network of computers.
- In 2019, the cryptocurrency market was estimated at $1.03 billion. But with an immense rise in the cryptocurrency market, it is projected to reach $1.40 billion by 2024 at a compound annual growth rate (CAGR) of 6.18%.
- In 2020, the cryptocurrency market will consist of more than 5000 different cryptocurrencies.
- These cryptocurrencies fall out into three main categories known as Altcoins, Tokens, and Bitcoins.
Investors are buying cryptocurrencies like Bitcoin, Etherium, and many others. As being the first digital currency Bitcoin holds the largest market share. People see them as an asset and sell them when the price increases. However, for many other investors, the cryptocurrency market is just ordinary speculation and not a real investment.
Types of Cryptocurrency – Cryptocurrency Market
There are three major categories to the cryptocurrency market that consist of more than 5000 cryptocurrencies.
Bitcoin was the first cryptocurrency to be developed in 2008. It is one of the leading peers to peer digital currency as well as holds the largest market shares. Bitcoin is a digital payment system that allows transactions directly across the globe without any intermediary like no banks. Bitcoin can book hotels, buy furniture, or even Xbox games anonymously.
Moreover, it provides us with cheap international transactions. Bitcoin does not govern by any financial institutions. Investors usually buy Bitcoins as an investment hoping that the value of Bitcoin will go up. These cryptocurrencies can be store in a ‘digital wallet’ which either belong to the cloud or on a users computer system.
These are the cryptocurrencies other than Bitcoin. Altcoins came into light after the success of Bitcoins. It is an alternative to Bitcoin. Altcoins generally include mining-based cryptocurrencies. As per the reports, there are over 856 Altcoins. The two of the largest altcoin estimated in February 2020 were Ethereum and Ripple. Altcoins operate freely on the networks utilizing distributed ledger technology (DLT).
A token is a unit of value issue on the top of an existing cryptocurrency blockchain. Like any other cryptocurrencies such as Bitcoins and Altcoins, a token can’t operate independently. The token is overall dependent on the other networks of cryptocurrencies. As per the reports, there are over 1496 tokens on the blockchain platform of 24 cryptocurrencies. Further, Ethereum, Omni, NEO, TRON are some of the platforms that host tokens.
Top 10 Cryptocurrencies Prices in 2020
You can also invest in these top 10 cryptocurrencies in 2020.
How do the Cryptocurrencies work?
As by now, you have gained knowledge of cryptocurrency so let’s move forward to know how it works. Today more than 30 million people use cryptocurrency. Cryptocurrencies use a decentralized technology that does not require any intermediary and lets users make secure payments. These cryptocurrencies run on a ledger known as Blockchain. Blockchain records all the transactions and balances of the currency holders and nobody can change them without fulfilling a particular condition. These ledgers provide transparency as well as visibility and lower the risk of fraud.
How to purchase Cryptocurrency?
The most common and accepted methods to buy digital coins involve credit or debit cards, bank transfer, or cash. Moreover, there are bitcoins ATMs where you can purchase bitcoins by using any payment methods like cash or card. There are different websites for different types of cryptocurrencies. You will have to find a website that sells the cryptocurrency that you want to purchase and invest in it. Lastly, before investing do your overall research and invest as much as you can afford.
List of Top 7 Apps to Buy or Sell Cryptocurrencies
As technology is enhancing the trend for the digital cryptocurrency market is the next step in the progress of money. It already has brought the revolution and transformed the digital transactions. Today everyone can invest in digital coins like Bitcoin, Ethereum, and many more at sites like Coinbase. However, the concerns regarding safety, privacy, and control are taking place. Further, you can also read about Pi cryptocurrency and know what is a Pi network.