In the past few days, followers of cryptocurrency (as an interesting subject and as an investment) have received notice from observers indicating the most recognizable name in the field is making a recovery. According to these reports, Bitcoin is back after hitting a long-term low in value. The reason for this rebound seems to be the expectation of an electronic traded fund (ETF).
In addition, charts are being circulating on the Internet showing an increase in the number of people who are interested in buying and holding cryptocurrency as an investment. This seems to be a positive period for cryptocurrency, because it is attracting the interest of people who hold significant wealth in other commodities and in cash. The question is: Should you follow their lead?
What Is Cryptocurrency?
You may feel you know enough about this as a wealth-building tool. If you do, that’s excellent. Unfortunately, thousands of people are making the decision to jump into the crypto-pond without learning to swim first. There are several options for mining, though you’d be wise to learn all you can about the best cryptocurrencies to mine from home. This is, however, only part of the bigger picture.
So, take a couple of steps back and refresh your memory on the subject. Consider the first step toward eliminating paper money, coins, and hand-written checks. This early stage involved increased use of plastic cards, along with money transfers completed electronically. It’s possible to conduct personal transactions and business transactions without using the currency printed and minted by a sovereign country. That much is true.
Traditional forms of “money” have not disappeared completely, but the number of people who “don’t carry cash” is growing consistently. Cryptocurrency, a relative newcomer to the electronic scene, is establishing a foundation as a medium of exchange, using digital data securely stored and protected. Because it isn’t a centralized medium, as the dollar or pound-sterling is, it can be extremely difficult to use it as a source for fraud (stealing wealth). As one industry observer noted, if you use the technology in the correct way, “they” can’t take cryptocurrency unless you want them to.
Is It Any of My Business?
The answer to this question is definitely, “Yes.” While digital currencies have been in use for a decade or more, adoption by the business sector has been rather slow. More financial institutions and technology gurus are getting on board, so to speak, which helps cryptocurrency’s popularity. There is still some debate about the true identity of this digital information, however. Is it a commodity or is it a currency? Like dozens of other traditional currencies, it can be a combination of the two.
Businesses will benefit from using cryptocurrency because it is fraud-proof. To put this in basic terms, when you own and hold “coins” their identity is encrypted. Tracking the movement of this medium is very accurate, meaning it can move from your “wallet” to another “wallet” and leave a checked-and-recorded trail. Is this the time to declare cryptocurrency an integral part of the global economy? Not yet, perhaps, but it’s close.