IN A GLIMPSE:
- What are Cryptocurrencies
- What is different about it
- Why is it hyped
- What method do we recommend
- Recap on the tips
Everyone is talking about cryptocurrency nowadays. Most investors have bad things to say about cryptos, yet a handful of investors still invest thousands upon thousands of pesos on them. The stigma about cryptos being unstable, too volatile, and widely used by criminals all contribute to why a lot of people stay away from them completely.
Although cryptos are relatively new, the intent behind it is actually revolutionary. In essence, cryptocurrencies are digital currencies that are meant to be a medium of exchange just like the US Dollar and Philippine Peso.
What makes cryptos unique is the technology behind it, blockchain technology. Blockchain technology is innovative because it doesn’t require a centralized authority to regulate a specific cryptocurrency. In blockchain technology, everyone has their own ledger that updates automatically.
What’s more interesting about this technology is that it is being recorded with powerful cryptography that makes it very difficult to counterfeit the digital currency.
So basically, cryptos are digital currencies. But why is there such hype about them if they’re just like normal currencies such as USD, PHP, and EUR? Cryptocurrencies are hyped due to their high gains (and losses). To put it in perspective, Bitcoin, the most famous cryptocurrency, was valued at $15 in 2012.
Now in 2021, Bitcoin is valued at around $30,500, that’s about 1.46 Million pesos per bitcoin. Early investors and cryptocurrency miners got rich quickly with Cryptocurrencies. In 2020 alone, Bitcoin from $7200 in January up to $28000 in December.
There are many more cryptocurrencies out there besides Bitcoin, which are called “Altcoins”. Some famous altcoins are: Ethereum (ETH), Ripple (XRP), Litecoin (LTC). Some of these even have greater daily gains than bitcoin itself. Investors with very high risk appetite seem to enjoy the volatility of cryptocurrencies, many of which are Filipino investors. In 2020, the telegram group Binance Filipino was recognized as one of the most active telegram groups around the world.
The simplicity of getting intro cryptos makes it very enticing. Unlike stock trading, which requires a bunch of documents and government IDs, getting into the crypto game only requires an app, an email address, and money. No more banks, no more documents, no more valid IDs. Since many Filipinos don’t have bank accounts, this makes cryptos very convenient, since apps such as Coins.ph, GCash, and PayMaya are enough to be able to cash in and start trading.
However, cryptos aren’t just like casino chips that increase in value greatly. Advancements in technology and familiarity with these digital currencies allow some businesses to already accept payments in cryptocurrencies. Only time will tell if cryptocurrencies will push through to their main purpose as mediums of exchange, and not just cash farms for the hardened trader and cash burners for the newbie trader.
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