If you’ve been scrolling past your feed the last few weeks—which we’re pretty sure you have been since we’re all still very much advised to stay at home, you’ve probably been reading words like bitcoin, eth, and doge, leaving you extremely curious.
Even if these words ring a bill but you still have zero clue as to what they mean—it’s perfectly fine. No judgment here! Crypto has been gaining so much attention in the last few months but many of us are still none the wiser about the topic.
As someone who gave into the hype and started investing in it, here's a little guide to help you understand crypto before you try it out yourself.
What is Crypto exactly?
According to Forbes.com, crypto or cryptocurrencies are digital currencies which can be used to buy goods and services. However, instead of using the traditional ledger being used in stocks, these currencies use an online ledger with strong cryptography to secure the online transactions.
These currencies or tokens are issued by companies. Cryptocurrencies use a technology called block chain to work. It’s a decentralized type of technology that spreads across many computers, managing everything including transactions. One of the many reasons it appeals to the tech and investment savvy is its sophisticated security.
There are so many different cryptocurrencies ranging from high to low
As of writing, there are about 10,000 different cryptocurrencies available in the market for the public to trade as listed on CoinMarketCap. Bitcoin (BTC), Ethereum (ETH) , Ripple (XRP) and Dogecoin (Doge) are all different kinds of coins with different uses. To give an example on how varied the prices can be, one Bitcoin costs about P1.5M, one Etherium is around P120,000 and one Ripple is at P45.
It’s Volatile…and I mean V O L A T I L E
Unlike stocks, the crypto market is incredibly volatile. This means that you could acquire 200% profit from some coins in a few days in the same way that you could also lose what you put in if there’s an unexpected crash.
For some people, this makes cryptos quite scary, intimidating and ultimately, an off-limits space. However, for others with an aggressive risk appetite, it’s something exciting and a really big opportunity to make quick money.
Where can you buy cryptocurrency?
There are so many different apps where you can easily purchase cryptocurrencies the same way you shop for stuff online—choose the currency you want, pay via credit card or e-wallet and then you’re done. But to be completely honest about it, these applications, EToro, Kraken, and Binance to name a few, can be quite intimidating during your first use. Take note that the prices can vary on each platform too, depending on the transaction fees. For first-timers, you may want to try purchasing through the Coins.PH app. While the currencies available are limited, you can easily convert your money in just one swipe.
Pro-tip: Before inputting your card details on any app, make sure to do your research and verify its legitimacy!
Don’t invest what you’re not ready to lose
We can probably go on all day talking about cryptocurrency jargon, charts, and some more tips—but that’s for another article. However, at the end of the day, it’s still much like a gamble. The rule of thumb: Never invest what you’re not ready to lose.
(Source: What Is Cryptocurrency? Here's What You Should Know, Nerd Wallet)
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