How "Crypto" Currency Works – An Overview of Bitcoin, Etherium and Ripple

“Crypto” – or “crypto currency” – is a type of software system that allows users to transact transactions over the Internet. The most important feature of the system is their Decentralized Nature – usually provided by Blockchain Database system.

Blockchain and “cryptocurrency” have recently become a major component of global zeitgeist; Bitcoin’s “price” is usually skyrocketing. This has led to millions of people participating in the market, with many “bitcoin exchanges” increasing demand amid massive infrastructural pressures.

The most important thing to realize about “crypto” is that while it actually serves one purpose (cross-border transactions via the Internet), it does not provide any other financial benefits. In other words, its “intrinsic value” is strongly limited in its ability to transact with other people; Not for price saving / promotion (which most people see).

The most important thing you need to understand is that “bitcoin” and the like Payment network – Not “currency”. It will cover more deeply in a second; The most important thing to realize is that “getting rich” with BTC is not about giving people a better economic position – it’s just about being able to buy “coins” at a lower price and sell them more.

To this end, when looking at “crypto”, you must first understand how it actually works and where its “value” actually lies …

Decentralized Payment Network …

As mentioned, the main thing to remember about “crypto” is that it is primarily a Decentralized payment network. Think of Visa / MasterCard without a central processing system.

This is important because it highlights the real reason why people are starting to see the “Bitcoin” offer more deeply; It gives you the ability to send / receive money from anyone around the world, as long as they have your Bitcoin wallet address.

The reason it is a “value” feature for various “currencies” is due to the misconception that “bitcoin” will give you the ability to make money as a “crypto” asset. It’s not.

The Only The way people are making money with Bitcoin has been due to “growth” – buying “coins” at a lower price, and selling at a much higher price. While this has worked well for many people, it was actually based on the “bigger fool theory” – basically saying that if you manage to “sell” the coins, it’s closer to the “bigger fool” than you.

This means that if you want to get involved with the “crypto” space today, you are basically looking to buy any “coins” (even “alt” coins) that are cheap (or cheap) until the price goes up until you sell them later. Since none of the “currencies” are supported by real-world resources, there is no way to predict when / if / how they will work.

Future growth

For all intents and purposes, “Bitcoin” is an expended force.

The epic rally of December 2017 hints at mass adoption, and although its price will probably continue to rise in the $ 20,000 + range, buying a coin today would be a huge gamble that would happen.

Smart Money is already seeing a lot of “alt” coins (etherium / ripple, etc.) that are relatively inexpensive, but prices are constantly rising and accepting. The key to looking at the modern “crypto” space is how the various “platform” systems are actually being used.

Such rapid “technology” space; Ethereum and Ripple look like the next “Bitcoin” – focusing on how they enable users to use “decentralized applications” (DApps) over their underlying networks to gain functionality.

This means that if you look at the next level of “crypto” growth, it will almost certainly come from a variety of platforms that you can identify there.