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Cryptocurrencies: Expand your mindset with Bitcoin, Bitcoin Cash, Ethereum & Litecoin

What is a Cryptocurrency?

Crypto is not associated with anything tangible in the real world. Unlike the GBP pound and penny, cryptographic units are simply computer-generated files.

It’s like a coin. Created to be a new kind of money, one-day cryptocurrencies could be used as widely as cash and credit. However, it is currently not widely accepted and cannot currently be used to pay or send money through PayPal.

It’s more than just Bitcoin. Although it was the first and is still popular, cryptocurrencies go far beyond Bitcoin. Three other major cryptocurrencies are available on PayPal: Ethereum, Litecoin, and Bitcoin Cash.

Not regulated. Cryptocurrencies do not belong to any nation and are not managed by agencies, organizations or companies.
It is a technology. Most cryptocurrencies work with an ecosystem of computer programs that run on thousands of devices around the world and are in a constant state of development and innovation.

It’s Growing and will continue to do so. Bitcoin was launched in 2009 as the world’s first crypto. Today there are thousands, each of which offers new opportunities and avenues for wider adoption.

Bitcoin

Bitcoin (BTC) was created to be a new type of virtual currency that can be sent directly from one person to another, across all borders and without the help of intermediaries such as banks. It introduced innovations like blockchain that proved that cryptocurrencies could one day be used as cash or credit.

Bitcoin’s breakthrough came by combining existing ideas like virtual currencies and encryption with its own bargaining chip called “Blockchain,” a technology that records the transactions and ownership of cryptocurrencies.

The invention of Bitcoin has spawned thousands of variations of the original, collectively referred to as Altcoins, all striving towards the goal of universal acceptance.

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Bitcoin Cash and how exactly is it different?

Bitcoin Cash (BCH) was created as an alternative to Bitcoin, something for everyday transactions when cryptocurrencies are widely accepted as a currency.

The number of transactions that can be processed per second is an important measure. Visa credit cards, for example, process around 2,000 transactions per second and can process many more. Bitcoin maxes out at around 20 transactions per second. This fee is fine when crypto is rarely used to buy something like a car, but not when it needs to be flexible enough to also pay for an Uber or buy groceries.

Bitcoin Cash, with the ability to support more than 100 transactions per second, is helping to show that cryptocurrencies could one day be a viable option even at the checkout counter.

Quick Facts

Bitcoin Cash is a fork or hard branch of Bitcoin that eventually became its own separate crypto due to philosophical differences over the purpose of Bitcoin.

While Bitcoin can process around 20 transactions per second, Bitcoin Cash can support more than 100 transactions.

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Ethereum

Ethereum expanded the capabilities of blockchain, the innovative technology behind Bitcoin that supports crypto transactions. The innovation of Ethereum Blockchain is that it supports the creation and execution of applications. Not like TikTok or Instagram, but applications designed to move things like crypto or anything else that exists in digital format.

Ethereum, like other cryptocurrencies, can be described by its blockchain and its virtual currency, which is known as “Ether”, with Ethereum as the engine and Ether as the fuel.

What if you could buy your first home without having to deal with tons of complicated paperwork? Imagine there was a digital alternative that could discreetly process confidential documents and record the direct transfer of ownership between buyers and sellers, all without the help of intermediaries. The idea with Ethereum is that there may be an application for this.

Building Ethereum applications can be complex and requires special software and computer programming expertise. Many people buy Ethereum with no intention of developing applications because they believe in the possibilities of the technology.

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Litecoin

Litecoin (LTC) is one of the first “altcoins” or alternative versions of Bitcoin that gained prominence and has been popular ever since. Compared to Bitcoin, it was designed for cheaper use and faster transaction confirmation, which is important to both customers and merchants if cryptocurrencies are to be widely accepted as a currency.

Crypto transactions take place all the time but are confirmed at intervals, such as when you use a credit card and consider pending charges until a later time. Litecoin transactions are confirmed every 2.5 minutes, four times faster than the 10 minutes it takes for Bitcoin transactions.

Litecoin also has four times the supply limit of Bitcoin (84 million vs. 21 million), which makes it much less scarce than Bitcoin.

Last but not least: Understanding Cryptocurrencies

What it’s worth:

The value of the crypto you own is the estimated amount of money you’d receive for selling it, in some cases minus transaction fees.

It can go up and it can go down:

Crypto market prices are constantly changing. As they rise and fall, so will the value of your crypto.

Cashing out your crypto:

When you sell your crypto, the money will go directly to your PayPal, Card or any other option you choose.

This Post Has 2 Comments

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