Cryptocurrencies and blockchain have become increasingly popular in recent years, offering users a safe & secure, low-fee payment system that is faster than traditional methods. With more than 18,000 cryptocurrencies in circulation & a total value of over $2 trillion, cryptocurrencies & blockchain are revolutionizing the payments are made. In this article, we will explain the basics of cryptocurrencies and blockchain, including how they work & the benefits they offer.
What are Cryptocurrencies?
Cryptocurrencies are digital currencies used in electronic payment systems that normally do not require government support or involvement of financial intermediaries such as banks. Cryptocurrency payments are validated using certain protocols. The first cryptocurrency was invented in 2008, called Bitcoin, & since then, cryptocurrencies have thrived.
What is Blockchain?
Blockchain is an immutable, tamper-proof ledger with encrypted data transactions in a network. This is the platform or netwrok where transactions of Cryptocurrenccies are stored & recorded, including Bitcoin. Bitcoin operates on its own Blockchain network. Ethereum, which is the second largest cryptocurrency, operates on its own blockchain network called Ethereum Blockchain..
How Cryptocurrencies Work?
Cryptocurrencies enable the users to make secure, low-fee payments in a matter of seconds. When sending a cryptocurrency, a user has to send a request to a blockchain network. This request is then validated & broadcasted to all nodes in the network. When all nodes in the network agree on the transaction, it is added to the blockchain & user receives confirmation of the transaction.
Is cryptocurrencies and blockchain are the same thing?
No, cryptocurrencies & blockchain are not the same thing. Cryptocurrencies are digital currencies used in electronic payment systems, while blockchain is an immutable, tamper-proof ledger with encrypted data transactions in a network. The platform or network where transactions of Cryptocurrencies takes place is known as Blockchain. Therefore, certainly both are not same.
What Are The Main Cryptocurrencies?
The main currencies that beginners should be familiar with are Bitcoin, Ethereum, Litecoin, Ripple, & Bitcoin Cash. Bitcoin is the first & most popular and widely used cryptocurrency, & it is used for both payments & investments. Ethereum is the second largest cryptocurrency, & it is used for smart contracts. Litecoin is the third largest cryptocurrency, & it is used for both payments & investments. Ripple is a cryptocurrency that enables fast & secure payments. Finally, Bitcoin Cash is a hard fork of Bitcoin, & it is used for both payments investments. There are 18,142 cryptocurrencies, 460 crypto-exchanges. Every 24 hours, $91 billion worth of cryptos are being traded, most of them happens to be Bitcoin or Ethereum.
Benefits of Cryptocurrencies
Cryptocurrencies offer several benefits over traditional payment methods. The speed of transactions is much faster than traditional payment methods, as transactions are completed in a matter of seconds instead of days. In addition, cryptocurrencies are much more secure & safe as all transactions are recorded on an immutable blockchain, making it impossible for hackers to alter or delete the data. Finally, there are much lower fees associated with using cryptocurrencies as there are no intermediaries like banks or payment processors required for the transaction.
Is Cryptocurrency: A New Money?
Grayscale Investments and The Harris Poll Survey Reveals that Democrats and Republicans Agree Cryptocurrency is the Future of Finance.
According to Survey “More than half of Americans surveyed (53%) agree that “cryptocurrencies are the future of finance,” including 59% of Democrats and 52% of Republicans, with 44% of Americans noting that they expect to have crypto as part of their investment portfolio in the future.”
Highlights from the Grayscale/Harris Poll :
- 49% of Americans are familiar (almost half of Americans) with Cryptocurrency. The Familiarity increasing among the investors including 70% of people at age group of 18-34, 62% in 35-44 age group. Compared to 43% of White Americans, thee familiarity is higher among minorities including 60% of Black and 62% of Hispanic Americans.
- 25% of Americans said that present economic condition and inflation have made them more interested in cryptocurrency. Normally Americans make do traditional investments like investing in equities or mutual funds.
- The conversation rate of interest in cryptocurrency to adoption/ investments are increasing among young and diverse investors. Almost 34% of Black (one-third of Black) and 32% Hispanic Americans, along with those under 45 years old who are 37%, states that present economic climate and inflation made them more interested in cryptocurrency. Approximately 30% of black and 32% of Hispanic, and 33% those under 45 years old Americans already own cryptocurrency.
- Nearly 25% invested based on recommendation from a Financial Advisor compared to 41% who read, saw or heard something that piqued their interest and 37% receive recommendation from friend or family member – among those who have invested in cryptocurrency.
- 79% of Americans feel (i.e. nearly four in five Americans consulted) more clear regulations of cryptocurrency is needed. This was with the support from 87% of Democrats and 76% of Republicans.
Main Takeaways of the Survey
1. Cryptocurrency has bipartisan support, with Democrats & Republicans alike agreeing that it is the future of finance.
2. The majority of Americans support the use of cryptocurrency for both payments & investments.
3. Over half of those surveyed believe cryptocurrency is here to stay.
4. Almost two-thirds of those polled believe cryptocurrency will definitely gain wide acceptance in the future.
5. Almost two-thirds of those surveyed believe that government regulation of cryptocurrency will benefit the industry in the long run.
Conclusion
The survey results shows clearly that there is increasing support to strengthen cryptocurrency rules and regulations. Being the leader of Global Financial System, the USA’s slow response to cryptocurrencies has shaken its position. It is important to understand from the survey that there is an urgent need of action from government authorities around the world, as the familiarity/ popularity of cryptocurrencies among the future generations are rapidly increasing, which means Crypto is to stay.
Cryptocurrencies and blockchain provide a safe & secure, low-fee payment system that is faster than all the other traditional methods prevailing. With more than 16,000 cryptocurrencies in circulation & a total value of over $2 trillion, cryptocurrencies & blockchain are revolutionizing the way the payments are being made. By understanding the basics of cryptocurrencies and blockchain, one can make secure transactions in just a matter of few seconds. However, many are concerned about the lack of regulation & oversight relating to the cryptocurrency market, & the possibility for putting it for illicit or illegal purposes. Moreover, the traditional Investors are not yet ready or feel comfortable to invest in this digital assets due to the high volatility & fluctuations prevailing in the cryptocurrency market.