FUNDAMENTALS OF CRYPTOCURRENCY 1 (RTA101A)

Module1: Concept of Cryptocurrency?

• What is Cryptocurrency
• Why should you invest in Cryptocurrency
• Reason Why People lose money in Crypto
• What Should I learn/know before Investing in Cryptocurrency
• Common Crypto Currency Scams and how to avoid them

CONCEPT OF CRYPTOCURRENCY

What is Cryptocurrency

Because it is decentralized, cryptocurrency is special in that neither a central bank nor an authority has control over it. The availability of cryptocurrencies every day of the week and every month of the year, as well as the ability to transmit money to anyone in the world via the internet as long as you have an internet connection, are unique characteristics of cryptocurrencies. My themes for this module will focus around this since I am aware that this material alone will never be enough to spread all of the knowledge around a specific topic, especially one as challenging as mine, but it is more than enough to get someone started.

A sort of digital asset called cryptocurrency (or crypto currency) is designed to serve as a medium of trade. Strong cryptography is used to safeguard individual coin ownership records in digital ledgers or computerized databases, preventing unlawful production of new digital coin records and verifying ownership transfers. It frequently isn't issued by a central authority and doesn't have a physical existence (unlike paper money).

I anticipate hearing the question, "What kind of challenging English is all this?"

Do not be alarmed; I will try to explain.

I want you, the reader, to understand what cryptography actually is before I stop my tangent. Data and communications can be encrypted using cryptography so that only the intended receivers can decode and read them. It's similar to saying that I interact with someone on Telegram over a locked or encrypted channel, meaning that only they can see the specifics of our talks unless I give them access directly (grant access basically).

The prefix "crypt-" is derived from the latin word "crypta," which often means "hidden" or "vault," and the suffix "-graphy" simply means "writing," respectively. As a result, it is also possible to say figuratively that "cryptography" denotes "hidden writings."

At least I'll refer to it as that!

In essence, this was one of the objectives that "Satoshi Nakamoto"—a person or group of people employing a pseudonym—set out to accomplish when they developed the Blockchain system and the original cryptocurrency, Bitcoin, which still commands the biggest market value and transaction volume.

The current price of this, which was developed in 2009, is more valuable than some government offices in several countries because it was open source (i.e., made available to the public for the community) and has since been enhanced (trying not to mention names of offices and countries).

When you take into account that bitcoin is, first and foremost, a digital asset because it can be spent, traded, and used as payment for products and services, you can see how everything makes sense. The most essential thing about it is that it can be traded for gains or profits on digital marketplaces, just like you would do with forex, which in this instance is done with actual currency.

The creation and widespread use of cryptocurrencies has fundamentally altered how the world views exchanges and trading.

For instance, I would go through the cumbersome process of dealing with the bank to use their third parties, such as Western Union, Money Gram, and so on, if I needed to send money to my buddy in Dubai. Keep in mind that when I referred to "third parties," I meant that after the bank verified the transaction, those parties each had a part in ensuring that my friend received the funds. He may typically need to go to the bank with a form of identification in order to cash the check. Since it took me so long to even type this, it goes without saying how someone who goes through this would feel. Laughs!!

But I'm trying to show that with Bitcoin and other cryptocurrencies, this isn't the case. As you may have noticed, I intended to say Bitcoin when I said "cryptocurrency." However, a lot of individuals believe that Bitcoin is the sole cryptocurrency.

Cryptocurrencies can be sent to anyone, at any time, and wherever they are in seconds. All that is required of them is that they FIRST, know what and how cryptocurrencies are used, have a wallet address from a TRUSTED and SECURED cryptocurrency wallet or exchange (which in this case is like your regular Bank account no), and that they have a wallet address from a TRUSTED and SECURED cryptocurrency exchange. In contrast to regular international transactions, which may take days, three, or even occasionally, something like this:

1GJdZ6xDKsqrhKzBYjEQjuXkMSfikH1QUm

In terms of value, usability, and acceptance, cryptocurrencies have grown quickly since being accepted by the general public in 2009. Investors are interested in a few of them as potential ways to generate returns and increase store value because they are accepted by numerous stores and merchants. Governments are attempting to determine the best ways to tax and control them.

With its programmability and adaptability, Ethereum, part of the blockchain ecosystem, offered not only a cryptocurrency but also a wide range of use cases. Companies and entrepreneurs are using it to develop new technology, goods, and services. The Ethereum blockchain and ecosystem are at the core of the burgeoning "metaverse," which has the potential to unite our digital and physical lives, as well as the decentralization of finance.

One of the many conversations that has validity is the one about bitcoin replacing fiat currency, given all the attention being paid to digital assets, cryptocurrencies, and the blending of realities. Learn what is causing these debates and how this change may impact the economies of the regions where it occurs.

By now, you know what a cryptocurrency is thanks to my earlier explanation.

Any successful unit of account must both serve as a medium of trade and a store of value. This usefulness is provided by both fiat money and cryptocurrencies, although they differ in a number of significant ways. While cryptocurrency is a digital asset whose value is derived from its original blockchain, fiat money is legal tender whose value is linked to a government-issued currency, such as the U.S. dollar. While blockchain protocols, code, and communities control cryptocurrencies, central banks control the issuance and administration of fiat currency. While bitcoin depends on dispersed and decentralized networks to facilitate "trustless" transactions, the distribution of fiat requires middlemen.

On the other hand, fiat money is a type of legal tender whose value is ensured by the administration that issued it. Fiat money includes the U.S. dollar, the euro, the naira, the Kuwaiti dinar, the yen, and many other important foreign currencies. It's interesting that some cryptocurrencies are linked to gold, notably PAX Gold and a few others. Contrast that with money whose value is backed by a tangible good, like gold or silver. Cryptocurrencies, on the other hand, are decentralized digital currency or assets that are held together by the blockchain technology. Fiat currencies, on the other hand, are government-issued money with the backing of the sovereign. When El Salvador decided to accept Bitcoin as legal cash, the discussion erupted.

This was just done to attract your attention to the fact that cryptocurrencies are tied to a wide range of assets, such as gold, land deeds, and much more, in addition to legal tenders like the US dollar and the euro.

There is undoubtedly plenty in the realm of blockchain and cryptocurrencies that has not yet been made publicly known, but trust me when I say that the sector as a whole has come a great way in the ten years since its inception.

Stablecoins, on the other hand, are conventional currencies that have been converted to digital form, like the dollar, naira, euro, pound, and numerous more.

They were developed especially to help traders manage their trading funds efficiently.

The situation would have been much better if official central bank rates had been the norm, though!

There was so much more they could have done, but I just have 12 minutes left, and these need to be finished. Except for a handful, like the USA and Europe, it is sadly not the case in the majority of the world's nations. I'm glad I avoided mentioning a nation; let's all exercise caution with that one.

Check the next post for the continuation of this class:

Why should you invest in Cryptocurrency