You have already heard of Bitcoin, perhaps without knowing what it really was… This alternative currency, called cryptocurrency, offers a number of advantages. Cryptocurrency is a good investment. Find out what these currencies of the future are all about and which ones are showing the most promise.
What is a cryptocurrency?
Cryptocurrency is a fully virtual and electronic currency. No notes or coins. This alternative currency is the result of open source software. To use it, the person must have the decryption code (password, fingerprint, etc.).
This cryptocurrency is proving to be a way to pay like any other. It is used to make purchases, transfers, transactions. Online exchange platforms make it possible to replace these assets with goods, services or currencies (euros, dollars, etc.). Its scale of value is the same as that of daily coins.
The peculiarity of crypto-currency is to escape any banking control. Transactions are made from very quickly and cheaply. Information about transactions is listed in the blockchain. It is a decentralized file network acting as a central bank. The blockchain turns out to be searchable by anyone on the Internet. On this huge directory, you will find a trace of each transaction with its amount, the addresses of the sender and the recipient. However, some cryptocurrencies, like Dash, allow transactions completely anonymously. Impossible to trace them.
Advantages and disadvantages of cryptocurrency
Cryptocurrencies do not suffer no banking or government control. You can freely use one of the many virtual currencies to carry out all your transactions. It is also a safe means of payment since no digital counterfeiting is possible.
However, crypto-currencies remain so-called alternative currencies. They have no legal tender in the world. They are also subject to inflation and deflation.
In total, there are more than a thousand different electronic currencies. Some of them stand out and turn out to be very promising from an investment point of view.
Bitcoin, the first cryptocurrency
Bitcoin remains the best known and most accepted cryptocurrency in online commerce. On showroomprivé.com or Amazon, for example, you can pay for your purchases in Bitcoin. Many websites specializing in high tech also accept this method of payment. In some countries of the world such as the United States or Japan, it is quite possible to pay with this alternative currency. In Paris, some establishments also allow payment with this crypto-currency.
Bitcoin was created in 2009. Its reliability most likely contributed to its success. It is a safe currency. On the blockchain, it is impossible to modify a transaction carried out in Bitcoin. Its other advantage is to carry out transactions without having to disclose its identity. With this cryptocurrency, you can also issue or receive online payments free of charge.
In contrast, Bitcoin has a highly volatile exchange rate, registering spectacular increases. The amount of Bitcoins in the world is also limited to 21 million. Impossible to go beyond. This limitation was desired by its creator (whose identity remains secret). This gives real value to this cryptocurrency. Specialists already compare the value of Bitcoin to that of precious metals. However, some economists are more reluctant about the longevity of this virtual currency.
Read also: How to buy bitcoins?
Investment, promising cryptocurrencies
Admittedly, Bitcoin remains the first crypto-currency, but it is not the only one to show promise in terms of investment. We must also count on Ripple, Litecoin, Peercoin, Namecoin…
Among all the existing electronic currencies, three of them could in the medium or long term dethrone Bitcoin.
Ripple is the third cryptocurrency of the world, after Bitcoin and Etherneum. This digital currency is gaining momentum. It is highly appreciated for its speed and security in world trade. Ripple can perform 1500 transactions per second. It is possible to transfer funds in real time. The price of this cryptocurrency is constantly growing.
Ripple uses SWIFT transactions, thus taking over the banking process. Among its customers, Ripple can claim to have convinced several financial institutions around the world. UBS or Santander are among the companies betting on Ripple.
This currency of the future could supplant Bitcoin in a few years and become the market leader.
Like Bitcoin, this cryptocurrency is based on the Blockchain. It allows its users to make payments to each other, which facilitates its reliability. All transactions made are completely secure. A significant number of investors are taking a close interest in Ethereum to carry out their projects.
Ether is the second largest cryptocurrency in the world, after Bitcoin. Its main strength is to offer smart contracts, or smart contracts. All transactions could undergo a revolution with this cryptocurrency. Ethereum would set up infallible contracts in seconds, much more efficient than those made by humans. This could make us revise our entire current model. And if Ethereum replaced notary, lawyer…?
Created in 2012, Dash is one of the rising cryptocurrencies. Its transaction fees are very low and very fast. It is a currency of exchange that is very popular. Dash could replace Bitcoin as the payment cryptocurrency in the future.
Dash is a top-notch anonymous e-money, ahead of Monero and ZCash.
On the eToro and Binance platforms, it is possible to invest in Dash speculatively to make profits.
Read also: Investing in cryptocurrencies: questions to ask yourself before you start