What Is a Cryptocurrency?

  1. Alice creates a transaction that transfers 1 BTC to Bob’s wallet. A transaction includes the sum of the transfer, the recipient’s Bitcoin address, and a digital signature created with Alice’s private key.
  2. Nodes check the blockchain if Alice really has 1 Bitcoin and the transaction is legit (contains the digital signature).
  3. Every node updates the version of the blockchain and adds the info about Alice’s transaction. The blockchain keeps the info about all transactions.
  4. Alice and Bob use the software to interact within the network; it’s a wallet. It can manage keys, incoming and outgoing transactions, and also send/receive cryptocurrency. When the transaction is checked, Bob gets the notification about received money, as well as Alice — about the completed transaction.
  1. Since it is impossible to freeze the account or withdraw the cryptocurrency, coins are available on your account at any time. You can check the reliability of the operations performed.
  2. Unlike fiat or electronic money, transactions with which are easily tracked, it’s quite complicated to get the information about the owner of a cryptocurrency wallet. Only the wallet number and limited data on the amount on the account are available. This makes cryptocurrency anonymous.
  3. As a rule, cryptocurrency is issued in a limited volume, which attracts attention to investors and eliminates the risks of inflation due to the excessive activity of the issuer. Thus, cryptocurrency is not subject to inflation and is inherently a deflationary currency.
  4. Cryptocurrency is a synonym for decentralization. Nobody regulates its issue and does not control the movement of funds on the account. Mostly, this feature attracts many members of the network.
  5. There is no commission for transferring funds between countries. Users pay the fees required from the blockchain to complete the transaction.
  1. Government structures do not have trust in cryptocurrency. Governments of quite a few countries do not look at cryptocurrencies as a real asset. Moreover, digital coins are prohibited in China, Bolivia, Columbia, and Iran.
  2. There is no way to revoke the payment. You should check the destination address twice.
  3. Volatility. Cryptocurrency price is unpredictable, as it depends on the current demand. Consequently, there are fluctuations in the price of virtual money.
  4. The private key to electronic money is a special password. If you lose it, the crypto coins in the wallet become unavailable.
  5. Each user is personally responsible for their savings. There are no regulatory mechanisms here, so it will not be possible to prove anything and return the money in case of theft.
  6. The cryptocurrency is not backed by anything.
  • If you are all set to start your investment experience, Otcfy.com is happy to offer you the best cryptocurrency purchase rates. But before, we would like to give you some investment advice:
  • DYOR! Study the market carefully before buying any cryptocurrency. There are always risks, and sometimes very big ones.
  • Do not think that if Bitcoin cost $20,000 last night and $19,999 this morning, you should immediately buy it. It’s not a stock market. You need to monitor the quotes and wait for the right moment closely.
  • It cannot be assumed that the cryptocurrency is growing at any moment, and you are guaranteed to make money on it. As we said in the example above, we must keep in mind that the market value is always several percent higher than the purchase price.
  • Do not rush to invest. A good deal doesn’t happen as often as you’d like. Analyze the market and be patient.

--

--

The Easiest and Safest Way to Buy & Sell OtcFY is the fastest, easiest and safest way to buy and sell cryptocurrency like Bitcoin, Ethereum, Tron and many more.

Love podcasts or audiobooks? Learn on the go with our new app.

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
OtcFY

OtcFY

The Easiest and Safest Way to Buy & Sell OtcFY is the fastest, easiest and safest way to buy and sell cryptocurrency like Bitcoin, Ethereum, Tron and many more.