You want to join the Crypto movement and invest in Bitcoin and other AltCoin, but you don’t know where to start? Maybe you’re afraid of being scammed or disappointments? Don’t panic! We are here to guide you and bring you all the answers you need. Discover, in this guide, our tips and recommendations, our ranking of the 10 most coveted virtual currencies, and everything there is to remember before embarking on the cryptocurrency with confidence.
What is cryptocurrency?
A term that is, nowadays, on almost everyone’s lips. But what exactly is cryptocurrency? Cryptocurrency is a virtual currency and a means of payment based on the principle of a “peer-to-peer” network (that is, exchanges are made directly between two users without going through a server).
Manufactured by people called “miners”, it is said of the crypto-currency that it is a “virtual” currency, because it is devoid of a “physical” medium, as for the notes or the notebooks of checks. Legally, cryptocurrency, described as belonging to the family of diverse goods, does not depend on any institution. As a result, it does not benefit from any legal tender in any country and this makes it difficult to index its value.
Nevertheless, the cryptocurrency has the merit of being a secure and transparent virtual currency thanks to the Blockchain (or blockchain).
Due to its guaranteed security and transparency, Blockchain has become a highly coveted technology by many companies, as it could be used in several other sectors. But what is Blockchain?
Blockchain is a distributed ledger technology that forms the basis of cryptocurrency. Indeed, all cryptocurrencies are codes stored in the form of “blockchains” (hence the term Blockchain) on a computer.
To fully understand the principle of operation of the Blockchain, it is enough to take a database and authorize the “members” of the network to make changes to it. It is then necessary to set up a control system, carried out by the voluntary members, each time a quantity of “blocks” is modified. After validation, these changes are dated and added to the register, which is then available to all members of the network. You can check out the article Bitcoin and cryptocurrencies, new digital coinsby in Les Échos for even more explanation.
Going back to the transaction and the ledger that is now accessible to all members, it should be known that the “miners” (who mine the cryptocurrency) hold an important role in the confirmation of these transactions. How? The miner must trace the cryptographic product, which connects the new block (freshly validated by the members) to its predecessor. The good service of the miner is then remunerated in tokens or tokens.
Mining cryptocurrency: how to go about it?
If you are an individual and you want to mine cryptocurrency, all you need is software with a processor and/or graphics card installed on your computer. This software will allow you to solve the complex computational problems of cryptography. Thus, you would have mined new units of the cryptocurrency. Eventually, the main cryptocurrencies have become complicated for individuals to mine.
However, you can resort to cloud mining, without you investing in hardware. All you need to do is get in touch with a company that invests in the software needed to mine cryptocurrency. Then you “rent” your “computing power”. Are there any risks associated with this method? Yes. You are unfortunately likely to come across scammers. Caution is therefore required.
The Role of Developers in Making Cryptocurrency
Unlike miners, developers will develop a computer protocol. This protocol is the foundation of cryptocurrency and defines several aspects, including the number of tokens in circulation and their speed of circulation, among others.
The Top 10 Essential Cryptocurrencies
There are several crypto-currencies and they are often difficult to identify. In 2019, more than 2,871 had been identified by the Ministry of Economy and Finance. Despite quantity factor, there are only a dozen cryptocurrencies that are popular and of qualities.
Recently, Bitcoin is on almost everyone’s lips and has forged an unwavering reputation in the world of virtual currency. Created in 2008 by Satoshi Nakamoto (a nickname and who does not know if it is a man or a woman), it is the first of all crypto-currencies. In 2017, and following a disagreement in the Bitcoin community regarding transaction speed, a “fork” (new cryptocurrency from an old one) was born: Bitcoin Cash. Despite being new to the market, the new cryptocurrency has easily positioned itself in 3rd position in the Top 10 cryptocurrencies.
Described as being more comprehensive than Bitcoin, the Etherum cryptocurrency is based on all applications of the Blockchain without exception. Thus, in addition to transaction processing, Etherum can also be used in the processing of contracts or other complex programs.
Thirdly, we have Ripple which is both a cryptocurrency as well as a transfer system to facilitate interbank payments. Our list of major cryptocurrencies continues with Litecoin, Cardano, NEM, Monero, Stellar, or Iota.
Cryptocurrency: the solution in the event of a financial crisis?
Covid-19 has impacted the financial sector very drastically and the term “financial crisis” has been mentioned over and over again. However, the cryptocurrency, although also affected, has been able to turn the corner and has even become a safe haven. To explain this phenomenon, the Economist and teacher-researcher of NEOMA Business School, Nathalie Janson, indicated in 2020 that several factors came into play, including “radical economic uncertainty, negative rates, weak dollar”.
Since the beginning of 2021, Bitcoin has established itself in the financial sector in terms of market capitalizations with no less than $40,000.
Stock Exchange 2021: ranking of crypto-currencies according to their value
Here are the Top 10 most popular and important cryptocurrencies based on their 2021 market value (the total value of tokens in circulation):
Market capitalization as of January 7, 2021: $638.506 billion
Price change over 1 year (USD): + 336% approximately
Market capitalization as of January 7, 2021: $129.635 billion
Price change over 1 year (USD): about 725%
Market capitalization as of January 7, 2021: $22.181 billion
Price change over 1 year (USD): – about 0.03%
Market capitalization as of January 7, 2021: $11.399 billion
Price change over 1 year (USD): about 18%
Market capitalization as of January 7, 2021: $10.218 billion
Price change over 1 year (USD): about 267%
Market capitalization as of January 7, 2021: $9.102 billion
Price change over 1 year (USD): about 705%
Market capitalization January 7, 2021: $8.868 billion
Price change over 1 year (USD): about 242%
Market capitalization January 7, 2021: $8.012 billion
Price change over 1 year (USD): about 85%
Market capitalization January 7, 2021: $6.658 billion
Price change over 1 year (USD): about 539%
Market capitalization January 7, 2021: $6.386 billion
Price change over 1 year (USD): about 684%
The different uses of cryptocurrency
Cryptocurrency can be used for various reasons and in various cases. Close-up on the different uses of virtual currency.