What is a crypto coin?
- What is a crypto currency
- What is the most popular crypto currency (s)
- What are the drivers behind crypto currencies
- Overseas applications for crypto currencies
- How does one obtain such a Bitcoin or crypto coin?
A crypto currency is best described as a currency which exists in an electronic format only. There is no physical form of a crypto currency. With other words you cannot hold it in your hands like a traditional currency such as USD, Euro’s, British pounds or Japanese Yen. In today’s world it is most comparable to frequent flyer points which any mayor airline offers. These points can be redeemed at any establishment accepting them. In case of frequent flyer point that would be the airline, rental car places as well as hotels. While the crypto currencies are similar to frequent flyer programs they offer great advantages over them. I will address those later.
What is the most popular crypto currency (s)
Unless you have some experience with crypto coins you are probably on this site because you heard about the most famous one of them, the Bitcoin. While the Bitcoin (BTC) has been around the longest and is considered the “gold standard” of crypto coins it is by farther not the only one any longer. Right behind Bitcoin (BTC) is the Litecoin (LTC) the silver standard in today’s crypto currency space. Beyond the two mentioned you can find over 100 crypto coins in some manner of circulation with new ones springing up from time to time. Just as new ones spring up they often disappear after only a few days, mainly due to a lack of interest in the marketplace.
What are the drivers behind crypto currencies
What are the drivers behind the crypto currencies one would ask? Well one of them is necessity. How could a 16 year old child purchase, let’s say, music from an online retailer if he or she is not in the possession of a –presumably the parents- credit card? Quite a few online retailers accept Bitcoin as a means of payment. While parents may argue over whether it is or is not a good idea nevertheless it is an empowering technology.
Another driver is the reduction in fees to retailers. Have you ever wondered why some locations don’t accept certain credit cards? It is primarily because the credit card companies charge the establishement a large transaction fee. If you were to pay the vendor using Bitcoin the vendor would pay virtually no fees. I believe it to be a magnitude less than the lowest fee credit card on the market today. Customers paying with crypto currencies would be able to receive a discount much like cash customers get at times. You may ask why not carry cash in first hand. Well one is that withdrawing cash costs money as well and carrying large amounts of cash (like many tend to Europeans do J) is not considered practical.
An application (App) on your mobile phone could hold an amount from less than a penny to hundreds of thousands of USD in an encrypted wallet. You can pay any vendor accepting crypto currencies from that wallet. Any vendor would literally be any vendor around the globe accepting that currency.
Overseas applications for crypto currencies
Crypto currencies have very empowering effect outside of the industrialized world. How does a person living in Africa or South America buy online goods when their countries currency is not freely convertible on the open market or they are not in the possession of a credit card? Living in the USA it is difficult to imagine an adult not having access to some sort of credit or debit card. In many countries outside of the USA and Western Europe electronic payments are not as common.
How does one obtain such a Bitcoin or crypto coin?
There are three main ways of acquiring those currencies, one is to purchase them from a seller another is to mine them and lastly receive them as a gift. The purchase route is becoming simpler as more trading houses (exchanges) are springing up around the world. Mining is a bit more complicated but we are trying to demystify that on this page as well. The gift route is rather self-explanatory.
When I speak about crypto coins inadvertently the topic of "they are not covered by anything" comes up. The truth is that not a single currency around the globe is covered by any tangible asset any longer. The United States along with all other countries decided to move away from the gold standard in the 1970's. It is and your fellow countrymen's trust and faith into your government that makes the piece of paper -with writing and numbers- worth anything. The United States is somewhat of an anomaly since the US Dollar has been around for some time. Germany has had fife different currencies since the beginning of the last century not including the Euro. And neither, with the exception of the German Mark, is worth anything today beyond paper recycling value.
With other words the crypt currencies are backed the identical way a USD, Euro or a Swiss Frank would be covered. It is covered by the trust of the people that it can be exchanged into something tangible, like a cup of coffee, at the time of a transaction.
We don't mean to suggest that any one of the crypto coins are worth any particular value were are merely trying to explain how it is utilized today