Cryptocurrency puzzles many an investor. The whole idea of a virtual currency in a blockchain technology is tough to describe and visualize for the average investor.
The extraordinary success of some investors fascinates novice investors. But, they continue to look for reliable and simple ways to research, navigate and invest in the promising profits cryptocurrencies offer.
Cryptocurrency explained
At one time, the United States was held to a gold standard. For every dollar in circulation (i.e., fiat money), there was a dollar’s worth of gold in Ft. Knox. The US dollar was released from the gold standard a long time ago. So, our belief that the full, faith, and credit of the US backs our currency is a belief in a virtual system. That’s one way of looking at cryptocurrency.
The press of technology drives the need for creating and using crypto coins. With mobile access to the internet consuming the world and its financial markets, transaction economies depend on the ability to move money faster, efficiently, and securely.
Transaction economies must move money faster than legacy technology permits. When tens of millions of customers are online simultaneously, the traffic hampers the transactions involving the customer, sellers, and merchant services, like a credit card or bank server. This speeds financial transactions for everything from pizza deliveries to Amazon purchases to international trade.
Cryptocurrency is not tied to any resource. It does not represent anything. Rather, its value arises from its scarcity, divisibility, and transferability. As Forbes says, “It has a certain number of units that can be exchanged, divided and moved between owners.” Investors can buy any number available, exchange them in whole or part, and buy and sell them through exchanges.
People worry this is just a fad, and that the bubble has already burst. The price has fluctuated with such volatility it scares would-be investors. But, those who have been invested for a long time have seen some unprecedented gains.
Cryptocurrencies are electronic peer-to-peer currencies. There are no coins or paper money. You can’t use them in vending machines or tip a cab driver, yet. But, that doesn’t make them worthless.
Cryptocurrencies are increasing because this is a technological evolution in a search for a system that works best for more users and investors than not But, these multiple options worry people, too, if they do not understand how the concept works.
Because this is an evolving idea, each new cryptocurrency seeks to correct or fix some technology “flaw” in the previous version.
Blockchain technology explained
Financial transactions require bookkeeping ledgers. Cryptocurrency transactions are recorded on blockchain ledgers. It’s a decentralized exchange where investors sell, transfer, or buy coins. It’s the record of an archive for transactions where people buy or sell goods or services. These transactions occur without third-party supervision or oversight, like the SEC or Federal Bank.
Avoiding traditional exchanges like banks speeds and secures the process. It also saves the fees paid to legacy intermediaries.
Writing for Vogue, Corey Seymour said, “When people talk about the “blockchain revolution,” they’re generally noting the blockchain can be used for secure transactions of almost any type: storing and moving birth certificates, votes, insurance claims, whatever.” And, this, of course, applies to virtual coins.
How to invest in cryptocurrencies
If you have the risk tolerance to embrace the cryptocurrency volatility, you need a way to enter the market, a way you can trust and use easily.
xCoins Inc. eases those concerns. It offers a unique automated system allowing investors to earn and traffic in bitcoins completely hands-free.
Trading cryptocurrencies at a peer-to-peer exchange take significant skill and patience. You must process each trade manually. You must check up on prospective buyers to exclude scammers. If you’re the seller, you must provide pre-sale support to explain the terms and conditions of the sale and necessary post-sale support if the buyer isn’t happy.
When investing in cryptocurrency, you want instantaneous access to bitcoin. xCoins does this and more. It doesn’t have to make charge-backs because they are not purchasing bitcoins for the investor. So, there’s no lengthy waiting period. You do need a wallet for your transactions but you can get one at xCoins:
Lenders deposit their bitcoins with xCoins.
Investors use their credit card* to buy any number of bitcoins and pay fees**.
Following notification that the payment has been made, xCoins moves bitcoin from the lender’s wallet to the investor’s.
The investor can, then, use the bitcoin at will.
*Typical cryptocurrency exchanges do not accept credit cards and require bank transfers.
**The lender decides on the interest rate, but the automatic system presents the lowest rate available. An origination fee also posts as investors navigate the system.
Once investors decide the cryptocurrency risk is worthy, they need a navigable and intuitive gateway to invest like coins.
Is it a good idea to invest in cryptocurrencies?
Investing in cryptocurrency is a gamble, but every investment in equities is a gamble. What we don’t have with cryptocurrency is history. The history we do have is wildly volatile but increasing over time. So, it may be the smart investment for the discretionary money.
The cryptocurrency market is young, and the promises for past experience offer significant value in the long run despite the potential for wild swings.
Despite the so-called “bubble,” this evolving medium of exchange has caught the attention of investors, merchants, customers, and more as a long-term solution for transaction economies and a store of value on its own.
We’re not in the business of making recommendations on investments, but the purpose and performance of cryptocurrencies are fascinating.
Time quoted Vitalik Buterin, the co-founder of the cryptocurrency Ethereum as saying, “cryptocurrencies are still a new and hyper-volatile asset class. . . . Don’t put in more money than you can afford to lose. If you’re trying to figure out where to store your life savings, traditional assets are still your safest bet.”
It’s a wise caution made by others who talk about smart investments. That is, cryptocurrencies are for speculators who should not use the money they cannot risk.