A Cryptocurrency, or Crypto Currency, is nothing more than a digital currency that is mathematically encoded and operated on a peer-to-peer network. A cryptoknowledge, as the term suggests, encodes and functions digitally without the use of a physical commodity such as gold or silver. It is this modern, virtual technology that has spurred a large-scale interest in learning more about this fascinating subject. But what exactly is it? And why should you care?
There are many different types of Cryptocurrencies, but two of the most popular are bitcoin and etherium. The difference between the two lies in their inherent nature and how they work. Both of these currencies are run on the same underlying technological foundation – a distributed ledger called the “blockchain”. However, there are many differences between the two and understanding these differences can help you decide which is best for you. Let’s take a look at each of the major differences between these two most popular forms of cryptography.
The most important difference between these two currencies lies in how they are stored and transferred. Unlike the public peer-to-peer storage and transfer of information that is characteristic of the traditional internet, with ethernet-based blockchains you will instead see the transactions and storage taking place between two private servers maintained by the individual holders of the currencies. In this way, you can see how much more secure and private the protocol is over the older peer-to-peer method.
Another major and most unique feature of bitcoin and etherium is that they are both resistant to any external influence. There is absolutely no way for an outside government to change the value of any of these currencies, meaning that no matter what happens there is no chance for the economy of a country to be in disarray. While this may sound like bad news for certain nations and industries that rely upon foreign investment or trade, it is good news for the everyday consumer who can watch his currency value appreciate without any worries.
However, this lack of external influences is not a deal breaker for many people. After all, many people are drawn to the idea of owning a new currency that is not tied to a certain government or economy. For these individuals, it is all about the potential for profit and freedom of ownership that the new cryptocoin has to offer. The fact that there are so many diverse forms of this new kind of money are also attractive to many. You can easily own a part of anything when you have your own virtual currency. This freedom of ownership is the biggest appeal to many of the new cryptocoin users, and it is one of the main reasons that investors and traders are turning towards the realm of etherium and bitcoin.
However, even in this competitive market there are some strong forces that are working against the cryptosporadise. There are many individuals and companies that are using their newly acquired wealth and capital to pump up the value of their old ones and reap in the profits once the market takes off. These individuals and companies will most likely try to manipulate the price of the old currencies to take advantage of the new ones that are just emerging on the scene. There is no sure thing when it comes to investing in the world of Cryptocurrency, but when you do decide to venture into the world of Cryptocurrency it is important to make sure that you do it with care. Do not take for granted the things you have just read about this exciting new industry.