New Delhi: This year, cryptocurrencies generated huge curiosity around the world. At the beginning of the year, there was a tremendous boom in digital currencies like bitcoin, dogecoin, but by the time of May, their value suddenly fell.
Investors who have lost profits are picking up again. That’s why there is tremendous curiosity about cryptocurrencies.
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What is cryptocurrency?
A cryptocurrency is a digital currency that has value but cannot be seen or touched. It exists in digital form and transactions can be done online. Unlike how country governments issue currency or paper notes or coins in exchange for a fixed value, cryptocurrencies do not work that way. Digital currencies are encrypted i.e. coded, hence they are also called cryptocurrencies. Its transactions are managed by a distributed ledger which ensures its transparency. It also brings anonymity through the use of encryption. Initially, there were a lot of apprehensions about its price. There was a time when only two pizzas could be bought with 10,000 bitcoins. Today it is the most expensive token money. Many companies have also started accepting cryptocurrencies as a payment system.
Is this legal?
Some South American countries have recognized cryptocurrencies but there are no formal guidelines for this. Almost all countries including India, US have not yet recognized cryptocurrencies. Hence it is not valid everywhere. But the central banks of many countries are moving in this direction. Cryptocurrency is banned in India but RBI recently said that it is looking to introduce its own digital currency.
Why is cryptocurrency becoming so popular?
The biggest reason is that it has started getting more returns than expected. There was a time when 10 thousand bitcoins used to get you only two pizzas, but now the cost of one bitcoin is about 17 lakh rupees. Many people are investing real money in buying bitcoins in the hope of good returns. Tesla owner Elon Musk has said that cryptocurrency could prove to be the currency of the future.
how to trade cryptocurrencies
According to the CoinMarket Cap website, more than 11 thousand cryptocurrencies are being traded through public exchanges around the world. According to the website, there are currently $1.5 trillion worth of cryptocurrencies in circulation in the market. Cryptocurrency is mostly traded through exchanges. India currently has 19 crypto exchange markets for buying and selling cryptocurrencies, with WazirX’s name in the news recently.
Names of some popular cryptocurrencies
Bitcoin, Ethereum, Tether, Binance Coin, Cardano are some of the popular ones. Of these, bitcoin is the oldest. It was launched in 2009 after a huge economic downturn in 2008. It was created under the pseudonym Satoshi Nakamoto.
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