Money digging, encryption, P2P, algorithm, excavator. These and many other words appear on the occasion of information about money that changes the financial system. Do you know what cryptocurrencies are? Can you be their owners? Can you pay for them with coffee? We answer these and other questions related to this new money.
Today’s payment system requires customers to trust
We trust banks and contractors, we believe that our centrally managed money is safe. Although the seeds of new thought appeared in the 1980s, it is groundbreaking on January 3, 2009. It was then that something revolutionized the financial system – the first block in the Bitcoin network called “Genessis” – the first cryptocurrency.
The authorship of a decentralized currency, independent of banks, governments, institutions, without territorial borders, accessible to everyone, is credited with Satoshi Nakamoto – a scientist or scientists. Although this idea can be called a revolution in the world of finance, its author never came to light. Interestingly, he did not use the accumulated bitcoins, so he did not join the group of the richest people in the world. But let’s start from the beginning.
What are cryptocurrencies?
CRYPTOCURRENCIES are virtual money used to store and transfer data contained on the internet. Their name comes from cryptography, or information encryption. Like a traditional banknote, we can pay with it, but it only appears on the internet. The development and growth of cryptocurrency is the result of the increasing availability of new technologies.
Cryptocurrency is a distributed accounting system containing the entire history of transactions concluded by all users. Only transactions are saved, but without information on who and for what purpose has performed them, the anonymity of the contractors is maintained. Each cryptocurrency has a limited limit of coins. Most cryptocurrencies operate on an open source principle, subsequent coins are created thanks to the work of computing power of millions of computers around the world (so-called mining). Source: spryciarz.pl
This type of money is not produced in the mint. They are produced by users who, thanks to a free, special application, extract them using the computing power of a given equipment.
I first heard about cryptocurrencies in college, about 6-7 years ago. Now I regret a bit that I did not invest then, because looking at the rates increased I would now have a lot of savings. In mid-2017, I decided to invest a certain amount in cryptocurrency according to the principle of not investing more than I could lose.
Since then I have also learned a lot from my mistakes and for now I am in the plus. In my opinion, because there is more and more information about cryptocurrencies in the press, television and mainly on the Internet, a lot of people are attracted to it, which means that courses go up. Compared to ordinary deposits, this is a much better investment, but also a greater risk.
As for the future of cryptocurrencies, you can write a lot here. At first Bitcon was to be used as a fast means of payment, thanks to which you can pay for coffee or buy something in the store. Unfortunately, this is not real at present because the commission for sending Bitcoin would be more expensive than this coffee and the Bitcoin transfer itself may take up to several hours. So today bitcoin is really a digital currency. Today we have well over 1000 cryptocurrencies. You should be aware that in a few years the value of some will definitely fall to a value close to zero, but some of them will probably have huge profits, which is why I recommend caution when investing in cryptocurrencies. Marcin, IT industry
Is it possible to buy something for cryptocurrencies?
Theoretically, you can buy everything for them, but you can’t pay with them everywhere. You can trade them, pay abroad, buy goods. In practice, cryptocurrencies are used to pay for computer games, gifts, books, etc. There are exchange offices where they can be exchanged for traditional currency. From 2016 in Poland, you can pay with digital money for e.g. bills or shopping on Allegro thanks to InPad. In some of Warsaw’s cafes there was also the option of paying with bitcoins.