If you’ve been thinking about entering the world of cryptocurrency but don’t know much about it, you’ve come to the right place.
Below is a beginner’s guide on what it is, how it works, the cryptocurrencies that have the largest market capitalization (total value), how to invest and more worthwhile information.
Here’s everything you need to know about cryptocurrency.
What is cryptocurrency? How does it work?
Cryptocurrency is a digital asset designed to be used over the internet, according to Coinbase. It’s decentralized, meaning it isn’t controlled by the government or any other central authority such as a bank.
You can use cryptocurrency to buy products from retailers who accept it as payment, such as Overstock, or sell it to make a profit.
All transactions are made secure and vetted by a technology called blockchain, which records digital assets in real time using code. Most cryptocurrencies have their own blockchain.
What are the different types of cryptocurrency? Which crypto should I buy in 2021?
There is currently over 8,000 different types of cryptocurrency, according to CoinMarketCap.
These are currently the 10 largest cryptocurrencies to trade by market capitalization, according to real-time data tracked by CoinMarketCap (Note: market capitalization is constantly changing).
- Bitcoin (BTC): $1 trillion
- Ethereum (ETH): $202.9 billion
- Binance Coin (BNB): $39.2 billion
- Tether (USDT): $38.5 billion
- Cardano (ADA): $35.8 billion
- Polkadot (DOT): $31.6 billion
- XRP (XRP): $19.8 billion
- Uniswap (UNI): $15.4 billion
- Litecoin (LTC): $13.2 billion
- Chainlink (LINK): $11.1 billion
What is Bitcoin? What is Dogecoin? Why is it so popular?
Bitcoin is currently the largest cryptocurrency and the first to be widely adopted, according to Coinbase. It was created in 2008 by Satoshi Nakamoto, a pseudonymous person or team.
To invest, you don’t have to buy one entire Bitcoin, you can buy just a fraction. One Bitcoin is currently worth over $56,000.
Tesla, the American electric vehicle and clean energy company, recently made headlines by investing $1.5 billion in Bitcoin, according to its recent SEC filing, and plans to accept it as a form of payment “in the near future.”
As for Dogecoin, another form of cryptocurrency, it’s nowhere near the same market capitalization as Bitcoin, but it’s still wildly popular. One Dogecoin is currently worth only $0.05, which makes it so desirable. It has a market capitalization of $7.2 billion.
Dogecoin was originally created as a parody cryptocurrency in 2013 by Adobe employee Jackson Palmer and software engineer Billy Markus, according to a report by CoinDesk. It’s a play on the popular internet meme of a Japanese Shiba Inu branded as “doge.” Its non-serious vibe caused it to become a hit and attract a huge following.
Tesla CEO Elon Musk is also a fan of Dogecoin and frequently tweets about the crypto.
How do I invest in cryptocurrency? Where can I buy crypto?
For starters, you need to sign up for a platform that allows you to purchase and exchange cryptocurrency.
Here are some options to get you started:
How can I protect myself from hackers?
If you’re not comfortable storing cryptocurrency through an online wallet, the best way you can protect yourself from hackers is to purchase a hardware wallet, which is similar to a USB drive.
A hardware wallet stores private keys (passwords) through a thumb-drive device, which you only connect to your computer when you want to access your crypto, according to Coinbase. As for online wallets, private keys are stored in an app or other software.
Here are some hardware wallets you can purchase to protect your crypto from hackers:
When did Overstock start accepting Bitcoin as payment?
Overstock became the first major retailer to accept Bitcoin in 2014, according to a report by CoinDesk.
The online retailer partnered with Coinbase to enable Bitcoin as a form of payment. For more information, check out Overstock’s help page here.
Overstock also has a “Bitcoin Bestsellers” page, which is what their customers “love to buy with Bitcoin.”
The following categories are a part of Overstock’s “Bitcoin Bestsellers”:
For more information on how cryptocurrency works, check out the video below:
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