Crypto currencies like Bitcoin and Ethereum fit perfectly into the world of alternative financing. They offer users the opportunity to conduct decentralized peer-to-peer transactions without having to rely on payment processing companies or banks. This is possible because crypto currencies typically work with block chains, digital ledgers managed by global computer networks..
The origins of virtual money
Bitcoin (BTC) is often called „digital gold“ and is the original crypto currency. It was and is the first digital payment system based on a block chain. The idea for BTC was first published on a cryptography mailing list on October 31, 2008 by Satoshi Nakamoto, the mysterious person (or group) behind digital money. However, the actual Bitcoin network was put into operation later, in January 2009.
For most of its existence, BTC was traded for less than US$ 1,000. In 2014, there was a brief rise of over $1,000, but it was not until 2017 that it really became mainstream. That year, between November and December 2017, the price of Bitcoin more than doubled, although economists and observers were increasingly concerned that it was in a bubble. The price of BTC fell just a few months later.
Crypto currencies strive for financial independence
Advantages of online trading with crypto currencies
The form of money trading has developed strongly from physical exchange to digital platforms. These changes have introduced a new and more secure form of trading, namely virtual cash. There are famous crypto-commerce platforms that are available online and have emerged as a digital alternative to other forms of cash or card trading. Choosing the right platform is very important because after all, it is hard earned money that is at stake.
The increasing popularity of online trading is due to the many important advantages it offers:
Every online currency has reduced the dependence of retail investors on compliance with the minimum pre-trade balance. The unavailability of the account balance no longer limits people’s investment opportunities. It enables better access to credits.
Save agent costs
The traditional trading system involves brokers who, depending on the transaction, retain a large part of the proceeds. Online trading has minimized the cost of third parties to maintain trading.
No transaction fees
The traditional methods cost monthly fixed costs for keeping accounts, signing checks, transfer fees and many other fees. These transaction costs make up a large part of the income. There are no transaction fees for trading crypto currencies online.
Access to international trade
The exchange in different countries also includes the appropriate currencies. This is the main reason for different exchanges based on geographical locations. International trade works with the exchange rate, which makes trading expensive and complicated. The introduction of the virtual currency has overcome the barriers to international trade and simplified global transfer.
The most secure transmission
Crypto currency is based on block chain technology and makes transactions secure. The block chain technology is one of the most stable technology processes. If the trader understands the mechanism of online currencies, he will execute the safest transactions. They enable double-checking, transaction requests and alerts to make the exchange more secure..
Transparency in information
Transparent information during a transaction is always the priority of the user. This is another great advantage offered by the online currency. The final transaction always remains public. This does not mean that the personal data of the account is published. It is just that it prevents fraud and protects data from hacks. It gives them the confidence for new beginners, as the protocol cannot be manipulated by anyone.
market for all
The online market for trading virtual currencies is an open market for everyone. This fact has made it very easy to send and receive money anywhere in the world. Since the currency form is available digitally, there are no trading restrictions. There are no government regulations and the applicable laws are followed worldwide.
As more and more people access the online platform for trading, the stock exchanges become more trustworthy every day due to new updates and regulations. It has proven to be the best medium of exchange for low income earners. The majority of investors claim that crypto currencies are the best long-term investments.
What chances do crypto currencies offer?
Crypto currencies are praised for enabling fast and secure transactions. This can be especially helpful for people who send money abroad. These are the most important opportunities that crypto currencies offer now and in the future:
What are the potential risks of crypto currencies?
Investors and popular culture have flooded the crypto-currency ecosystem in recent years. While the introduction of virtual cash has potential benefits, there are also risks that every reader should be aware of:.
Crypto currencies are a risky asset class that should be carefully researched and evaluated.
security measures for crypto currency holders
Crypto currencies have become one of the most innovative forms of technology to date. They bring all the advantages of new age innovations to the financial sector and enable fast, anonymous and much cheaper transactions. Furthermore, transfers can be processed over long distances.
Since the outbreak in 2008, BTC has achieved a value of almost 10,000 US dollars per token. At the same time, several other Altcoins have also seen their prices rise. Crypto-currencies have finally solidified as part of our financial system, and at this point they are unstoppable.
They offer a variety of advantages, but there are also some risks that users should consider. The first thing that most crypto-critics point out, of course, is that crypto-currencies are unregulated and have a history of helping criminals launder money.
In truth, there are many countries that have not regulated crypto currencies until today. However, this has not prevented assets from becoming more practical and useful – even in these countries. In terms of criminal activity, almost the same can be said about traditional cash. Money laundering has existed long before the invention of coins and tokens and will continue to exist as long as there is money.
Then the safety risk exists. Most crypto currencies are stored at stock exchanges or individual wallets. However, as with traditional bank accounts, there is a tendency for these asset managers to suffer hacks. In fact, there have been several significant hacks in the history of the crypto room.
Virtual risks: These are the most important hacks
In January 2018, the Japanese crypto stock exchange Coincheck suffered an attack in which about 534 million US dollars of coins were stolen. It is worth mentioning that a hot wallet was responsible for this theft. Nevertheless, the fact that the hackers were able to move such an amount is incredible.
Lon Wong, the president of NEM Foundation, called it the biggest theft in the history of the world. While this might be controversial, this hack remains the most significant in the crypto room.
Mt. Gox: 2011 to 2014
Another major hack was that of Mt. Gox, a Japanese stock exchange which was the largest in the world at the time. By 2013, an astonishing 70 percent of all Bitcoin exchanges worldwide were taking place through this platform. Nevertheless, even then the platform developed some significant problems.
The first major hack of Mt Gox occurred in 2011, when 80,000 BTC were stolen from the founder of the exchange, Jed McCaleb, when he tried to sell the exchange. A hacker was able to access McCaleb’s account and use administrator access to artificially lower the price of Bitcoin from about $17 USD to $0.01 USD. This allowed the transfer of about 2,000 BTC before the attack was found.
Since then there have been other significant hacks in the crypto industry. However, it is also worth noting that events such as these have led to stock exchange operators being more cautious about operating their platforms. Security features have improved significantly since then, so the chances of such a hack occurring again are very small.
So investors improve the security of virtual currencies
There is always the risk of a hack. Almost everyone who deals with crypto currencies has a clear understanding of it. It is therefore worthwhile to understand how users can guarantee their own security.
While exchanges such as StormGain, Binance and Coinbase are known for their high security, owners of crypto-currencies can also take some steps to be more secure.
StormGain has earned a reputation for providing users with optimal security. The exchange enables effective two-factor authentication, ensuring that users can effectively secure their accounts with multiple levels of verification. In addition, the StormGain platform is supported by best-in-class encryption and can enhance security based on the device.
Hardware Wallets: The only way out?
Most experts advise against storing large amounts of crypto currency on a stock exchange or in an app for digital wallets. All this offers attackers various ways to penetrate the wallet.
Hardware wallets are affordable and easy to set up. They also work great because users can easily recover a lost wallet and the details it contains. So users have everything they need in one place – easy handling, setup, optimal security and a clear way to recover a lost wallet. With a hardware wallet, the only threat is that the details could fall into the wrong person’s hands.
Another disadvantage is that hardware wallets slow down transactions. Users cannot use a hardware wallet to perform transactions as quickly as those connected to the Internet. So if you prefer to make regular transfers, you may want to transfer some assets from your hardware wallet to a digital one. This at least minimizes the risk that users are exposed to.
BTC as resistance and safety concerns
In just over 10 years, BTC has evolved from a small Cypherpunk community into a national security issue with enormous implications for geopolitics.
Virtual currencies are strongly focused on the impact of a changing geopolitical landscape. In this landscape, the Ripple, Ethereum and Co. could play an important role in the upcoming war for technological dominance and at the same time act as the key to the digital „exit“ from state control.
Dynamics of mining
It is clear that a profound change in the global power dynamics has taken place in recent years. This is particularly evident in the growing importance of computers and connectivity in the context of cyber security and national defense..
Among the milestones of this phenomenon is Amazon Web Services, which is now part of the largest defense company or, as Huawei was accused of allegedly endangering the national security of the USA. In addition, semiconductor companies such as Intel and TSMC have begun to relocate onshore production to various countries. The same will probably happen with Bitcoin mining.
BTC as resistance money ?
The stable coins could also be issued by governments as digital currencies in the future. Numerous providers are already trying to copy the idea and implement it in different ways. However, digital currencies issued by the central bank have nothing to do with BTC.
The statement that these systems are block chain based could be part of an intentional misrepresentation. Finally, propaganda is slowly penetrating this industry. Nevertheless, central bank currencies remain an improvement on the existing fiat infrastructure.
BTC and other virtual currencies still solve the choice of currency system. People who are dissatisfied with the way the traditional system works have few options to defend themselves. BTC thus becomes a pioneer of a new form of resistance money. Paradoxically, digital money can therefore be seen both as a question of security and as a way out.