Cryptocurrency: What It Is And How To Make?

Cryptocurrency: What It Is And How To Make?

Cryptocurrency – a phenomenon of the 2010s. The technology, which appeared out of nowhere and the ability to bring a huge income. It’s time to understand it. So cryptocurrency: what it is and how to make use of this technology?

For seven years, the world has experienced a full-fledged financial crisis and several major shocks. At the same time, the consequences affected all developed countries. Only the United States have estimated their losses at $ 1.5 trillion.

Such things do not go without consequences. As a result, we have seen a sharp rise in the euro against the dollar, their parity. There was a 30 percent depreciation of the Swiss franc. What to say about the national currency of Russia, Belarus andUkraine?Perhaps, there is not a currency in which you can be sure your best.

But technology does not stand still. While the financial sector has been a panic, its electronic currency came from the Internet. Moreover, not even one, but several.

History cryptocurrency

Electronic innovations – it’s all a miracle. They quietly come into our lives and make it much easier and more interesting.



University of Cyprus accepts to pay for Bitcoin
University of Cyprus accepts to pay for Bitcoin

Here an example. Twenty years ago, people relied only paper maps. Well, in the direction of the growth of moss in the forest.

Now everything has changed. I remember how lost in the suburbs of London, while looking for the right terminal Heathrow (there’s a lot of road junctions). And the only thing that could help – an electronic navigation here maps on my Nokia.

In fact, we do not even notice how emerging technologies. Does anyone remember the first day of Yandex? Or WebMoney?So, at some point, the money started to become digital.

History cryptocurrency started with bitcoin. This is the first of cryptocurrency. She – the most popular to this day.

Who and why invented Bitcoin

It all began in the midst of crisis. Oct. 31, 2008 published an article «Bitcoin: A Peer-to-Peer which was described by a system of electronic cash – Bitcoin. January 9, 2009 was released the first version of the bitcoin wallet and running the network Bitcoin.



It is believed that the creator of Bitcoin – a Japanese Satoshi Nakomoto (click to see the full picture)
It is believed that the creator of Bitcoin – a Japanese Satoshi Nakomoto (click to see the full picture)

During the year were some improvements. Appeared API-interface for third party operating system support linux. At this time, bitcoin was known only to a small group of developers and testers.

In November 2009, the forum was opened first cryptocurrency. This attracted new users. In discussions with new ideas were born.

In 2010, developers have found and eliminated several defects and vulnerabilities cryptocurrency. Security has been enhanced. Number bitcoin – purse was growing rapidly. Along with the growing number of users and the course.

 

The first exchange bitcoins on real goods took place in May 2010. Then, the American Laszlo Hanech for fun got two pizzas for 10,000 bitcoins. As you know, it turned out to be the most expensive in the history of pizza. For now, for 10,000 bitcoins can fetch more than $ 3.3 million.

Another interesting case occurred in Britain with James Hauelsom in 2009, the year. James was one of the first who began to mine bitcoins. After spending some time, he decided that the technology is useless. One day, James shed on his laptop computer drink. The laptop is broken, and threw it Hauels safely. At the same time, the hard drive was left intact. The computer memory has information about Bitcoin 7500.

A few years later, James realized the value of what was in his computer. He spent several weeks in the city dump in search of the hard drive. But it was too late. Discarded bitcoins today would cost $ 2.5 million.
gavin-andresen-bitcoinBeginning in 2012, the project is supervised by an American company bitcoin Bitcoin Foundation. Leading developer of the company – Gavin Andresen. It can be considered as the project leader. According to Gavin, his goal – is to create a safe, stable “cash” in the Internet.

Since 2010, in pursuit of profit, many people began to engage in mining (production bitcoins). Gradually, online shops and services began to take cryptocurrency as payment. Since then, the popularity of Bitcoin is only growing.

 

Further development cryptocurrency

Bitcoin has spread all over the year and a half. Seeing this success, many developers began to create their cryptocurrency. Most of them, in fact, the first copy technology cryptocurrency.

To date, we know of the existence of 92 different cryptocurrency. Not all of them are now in demand. However, they may surprise us in 2-3 years.

List common cryptocurrency

The name of the currency Currency code Year established Course on 10 October 2015
Bitcoin BTC 2009 334 USD for 1 BTC
Litecoin LTC 2011 3.2 USD for 1  LTC
Nubits NBT 2014 1 USD for 1 NBT
Namecoin NMC 2011 0.4 USD for 1 NMC
Peercoin PPC 2012 0.39 USD for 1  PPC
Ripple XRP 2011 0.0043 USD for 1 XRP
NXT NXT 2013 0.0063 USD for 1  NXT

How does cryptocurrency. What is the Bitcoin.

Where does cryptocurrency? Obviously, this is not necessarily money. They are not issued by the central banks. And do not depend on the monetary policy of a state.

The emission occurs only in digital form. Anyone can produce cryptocurrency (engaged in mining). It uses the computing power of the computer.

What is mining cryptocurrency

word “mining” has come to us, as it often does, from the English. Literally translated as “mining”. Only mining cryptocurrency made ​​not in the mine,and the computer.

What is the same bitcoins? It is a sequence of unique encrypted blocks of information. Simply put – a certain sequence of ones and zeros.

So, to get new bitcoins, you need to compute a new unique sequence of blocks. The received blocks are transmitted to the base bitcoins network. And the more bitcoins mined, the more difficult to get new ones.

The fact that the first volume of the issue cryptocurrency fixed. Over time, for the same number of blocks is given less Bitcoins. The original size of the issue when creating the block was 50 bitcoins. Now – half. Already in 2031 the emission will be stopped completely.

To calculate the blocks required to perform a large number of independent calculations. Since calculations are mutually independent, they can be performed in parallel. Technically, such a task is best cope GPUs (graphics cards).

The computational complexity increases with time blocks. Thus, the amount of work required to generate the block, now a million times (literally) than in 2010. Generating units become more energy-intensive.

It is now the electric bill that spends graphics covers revenue from the production of Bitcoin. Advantageously, there is only an industrial mining professional with more processors. And even then, only as a result of economies of scale.

Purse cryptocurrency



Blockchain – the most popular and safe enough bitcoin wallet (click to enlarge)
Blockchain – the most popular and safe enough bitcoin wallet (click to enlarge)

Storage cryptocurrency made ​​on the specific electronic wallets, about the same as with WebMoney.There are several dozen different purses. Some of them are installed on your computer / phone, other’s work online. Exchange cryptocurrency organized either through exchangers and Exchange Commission, either directly through transfers between holders purses.

Because of its popularity, cryptocurrency can pay off in many online stores. Thus, customers can exchange bitcoins to the usual currency. At the same time, especially the development of payment solutions related to Bitcoin.

 
bitcoin-katra-2-300x192Now you can even release the payment card for everyday payments. And these cards already offers a number of companies. They can be used at any terminal. The conversion will take place at the current exchange rate.

In recent years, because of the high volatility popularity rose cryptocurrency traders. Some brokers already offer cryptocurrency as trading instruments. Among these brokers have, for  FXOpen example, and Instaforex.

 

The course cryptocurrency

Digital currency is not dependent on geopolitics. They are not  by the volume affected of oil or war. Therefore, the course puts cryptocurrency exclusively by the laws of economics. Mark decides to supply and demand.

The proposal (emission) majority cryptocurrency forcibly limited. For example, the total volume of the issue bitcoins is limited and will not exceed 21 million. As an additional issue, the course cryptocurrency down slightly.

Demand for cryptocurrency dictated their popularity and prevalence. In addition, there may be deliberate speculation. So, in 2013, Bitcoins market makers have made ​​tremendous jump course. Then, in just one month, Bitcoin value increased from $ 200 to $ 1,000 per 1BTC.

By the way, in recent years the price of Bitcoin has risen dramatically, too. Over the past 30 days, the growth rate reached 50%. Today, for 1 unit of BTC can fetch $ 334.

The advantages and disadvantages cryptocurrency

Thanks to digital technology, and absence becomes toiletries, cryptocurrency have several advantages over conventional

  • currency: Transparency.Due to its technology, wallets cryptocurrency store all transaction history. Any user can view the balance of all transactions of any crypto-purse, knowing his number.
  • Security. Cryptocurrency can not be faked.
  • Anonymity. There is no reference to the name and address. Banks and the tax authorities do not control the movement cryptocurrency.
  • Independence. Turnover cryptocurrency not subject to state bodies and regulators.
  • Convenience. Open e-wallet on the procedure easier than a bank account. At the same time, the speed of operations cryptocurrency much higher, and the commission – less.

The disadvantages are:

  • unclear legal status.In some countries, cryptocurrency completely banned. In others, such as the Russian – not recommended.
  • Using  shadow economy. The Attackers use cryptocurrency for settlements among themselves. So they avoid the attention of the supervisory authorities.

How can I make money on cryptocurrency

There are three variants of the workers on earnings cryptocurrency. Mining, investment and trading. Mining we reviewed. Therefore, stay on details on other opportunities

Investing in cryptocurrency



Famous billionaire Richard Branson said bitcoin best investment.
Famous billionaire Richard Branson said bitcoin best investment.

Is very simple. We set up a purse. Buy one or the other cryptocurrency in anticipation of its growth. After a while, we sell cryptocurrency.

Buy cryptocurrency possible at exchange offices. It is best to use the most proven ones. Among these, I refer alfacashier.com.

In this case, I recommend to pay attention to developing cryptocurrency. For example Peercoin grew by 3% last month. Agree, it is much  than the yield higheron bankdeposits.

In addition, it is possible to invest in bitcoin, when its price falls. This cryptocurrency has a very high volatility. Fall rate is always replaced by a sharp rise.

Cryptocurrency Trading

Brokers tend to offer only the most popular cryptocurrency trade. For example, FXOpen offers us Bitcoin, Litecoin, Namecoin and Peercoin. This is available for buying and selling cryptocurrency for US dollars, euros and Russian rubles.

Liquidity is usually provided the largest online exchange – «BTC-e». In other words, trade is made  technology ​​by ECN.That is the second party transactions serves not the broker, and other traders.

In general, it is beyond a profitable option for those who are willing to try their hand at trading. High profits are accompanied by high risks. Therefore, prior to the opening of actual transactions, I recommend to practice on demo accounts.

I would appreciate your questions or your opinion about cryptocurrency the comments in.

I wish you all a profitable investment!

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