An Introduction to Cryptocurrency: Benefits, Challenges, and Risks
Cryptocurrency is a digital form of cash that is secured by cryptography. It is decentralized, meaning there is no governing body over it, and it is incredibly difficult to counterfeit or manipulate.[0] Blockchain technology is what powers most digital currencies, and it is used to make secure, transparent, and immutable ledgers of transactions for businesses and end users.[1] Additionally, it can be used to create immutable records of customer data that are stored securely on the distributed ledger.[2]
Cryptocurrencies can be used to facilitate peer-to-peer money exchanges online, making it popular because it does not involve third parties like banks or credit card companies.[3] However, users must be aware of certain challenges connected to security, privacy, and control in order to benefit from cryptocurrency.[2]
The most popular digital currencies are Bitcoin and Ethereum, although there are many other cryptocurrencies and Altcoins that are gaining traction in the market.[4] Staking is an important process used to secure and operate blockchain networks, and it involves pledging tokens to validators who process transactions.[5]
Cryptocurrency is extremely volatile, and the prices vary in their use. If users keep holding them as assets without making purchases, they will see a downfall in the value of cryptocurrencies.[6] To purchase cryptocurrency, users will need a crypto wallet and a crypto buying site. There are many online platforms known as crypto exchanges, which allow users to store and manage their currencies as they see fit.
Unfortunately, cryptocurrency scams are increasing, with about 46,000 people reporting they’ve lost more than $1 billion.[7] The FBI warns people to be aware of the warning signs and be alert to the ways fraudsters try to reel them in.
0. “How to invest in Cryptocurrency UK | Money Guru” www.moneyguru.com, 11 Feb. 2023, https://www.moneyguru.com/insights/how-to-invest-in-cryptocurrency-uk
1. “The Future of Ecommerce: What Role Will Cryptocurrency Play?” www.corecommerce.com, 11 Feb. 2023, https://www.corecommerce.com/blog/cryptocurrency/
2. “Cryptocurrency Market is likely to reach $12.10 billion by” www.globenewswire.com, 11 Feb. 2023, https://www.globenewswire.com/en/news-release/2023/02/07/2603472/0/en/Cryptocurrency-Market-is-likely-to-reach-12-10-billion-by-2030-Globally-at-a-CAGR-of-11-9.html
3. “Digital Currencies as National Threat and Opportunity > Joint Chiefs …” www.jcs.mil, 11 Feb. 2023, https://www.jcs.mil/JKO/Latest-News/JKO-Customer-Spotlights/Article/3204717/digital-currencies-as-national-threat-and-opportunity/
4. “Exploring Cryptocurrency Technology: 8 Facts to Learn About …” www.tekedia.com, 11 Feb. 2023, https://www.tekedia.com/exploring-cryptocurrency-technology-8-facts-to-learn-about/
5. “Coinbase Global Inc chief warns of potential cryptocurrency staking …” www.proactiveinvestors.co.uk, 11 Feb. 2023, https://www.proactiveinvestors.co.uk/companies/news/1005709/coinbase-global-inc-chief-warns-of-potential-cryptocurrency-staking-ban-1005709.html
6. “What is Cryptocurrency and what are its benefits? | Payments” www.telemediaonline.co.uk, 11 Feb. 2023, https://www.telemediaonline.co.uk/what-is-cryptocurrency-what-are-its-benefits/
7. “FBI: More than $1 billion lost in cryptocurrency scams as popularity …” denvergazette.com, 11 Feb. 2023, https://denvergazette.com/news/crime/fbi-more-than-1-billion-lost-in-cryptocurrency-scams-as-popularity-increases/article_5807978c-a32b-11ed-a7f4-c313b881fb62.html
