How “Crypto” Currencies Work – A Brief Overview Of Bitcoin, Ethereum & Ripple

Crypto- or “cryptocurrencies” is a type of software system that provides transactional functions for users on the Internet. The main feature of the system is their decentralized nature, usually provided by the blockchain database system.

Blockchain and “cryptocurrencies” have recently become important elements in the air of world time; mainly because of the exorbitant “price” of bitcoins. This has led to millions of people becoming market participants, and many bitcoin exchanges have experienced huge infrastructure tensions as demand has soared.

The main thing to consider with regard to “cryptocurrency” is that, although in fact it serves only one purpose (cross-border Internet transactions), it does not give any other financial benefits. In other words, its “inner value” is invariably limited to its ability to do business with others; NOT in the storage/distribution of value (as most people see it).

The most important thing to understand is that Bitcoin and the like are payment networks, not “currencies.” This will be reviewed in more detail in a second; The most important thing to understand is that “getting rich” with BTC does not mean giving people a better economic situation – it’s just a process that allows you to buy “coins” cheaply and sell them more expensively.

To do this, when you look at the “cryptocurrency”, you first need to understand how it actually works and what really is “value” …

Decentralized payment networks …

As mentioned, the most important thing to remember about “Crypto” is that it is, first of all, a decentralized payment network. Think of Visa/Mastercard without a central processing system.

This is important because it highlights the real reason why people have really begun to take a closer look at the Bitcoin proposal; It gives you the ability to send/receive money from anyone in the world if they have the address of your bitcoin wallet.

The reason why this assigns a “price” to different “coins” is the misconception that Bitcoin will somehow allow you to make money by being a “crypto” asset. It’s not that.

The only way that people earn on bitcoins is the “higher” price – buying “coins” at a low price and selling them at a MUCH higher price. Although it worked for many people, in fact it was based on the “big fool theory” – basically saying that if you can “sell” the details, it’s a “big fool” than you.

This means that if you want to participate in the “cryptocurrency” space today, you are essentially buying one of the “coins” (even “alternative” coins) that are cheap (or cheap) and increase their price until you sell them. Then. Since none of the “coins” are secured with real assets, it is impossible to estimate when/or/how it will work.

Future growth

In all respects, Bitcoin is a depleted force.

The epic December 2017 rally signaled mass adoption, and while the price continues to rise to more than $20,000, buying any of today’s coins will actually be a huge gamble.

Smart Money already considers most “alternative” coins (Ethereum / Ripple, etc.), which are relatively low, but are constantly growing in price and their popularity. The most important thing to pay attention to in the modern “cryptographic” space is how different “platform” systems are actually used.

It’s a fast-paced space of “technology”; Ethereum and Ripple look like the next “bitcoin” – with a focus on how they can actually allow users to actually use “decentralized apps” (DApps) on top of their core networks to make functionality work.

This means that if you look at the next level of “cryptocurrency growth,” it will almost certainly come from different platforms with which you can identify yourself.

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