Money advice: What on earth is cryptocurrency and how do I use it?

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Do you know what cryprocurrency is? Are you completely baffled by it, like me? If so, today’s blog post is for you because I’m sharing my research into cryptocurrency so that we can all get to know more about this new way of earning and spending money online…

Cryptocurrency is digital money and it was created as a new secure way of transacting online anonymously. It makes use of encryption techniques to bring about regulation and to generate its release, utilising a method known as cryptography. This process involves converting important information into codes as a way of tracking each transaction. Are you any clearer on the topic of cryprocurrency yet??

Cryptography isn’t a new technique – it was actually was created out of an urgent need to have secure communication in the second world war, can you believe it? The method has since evolved in this digital era and is now being used to encrypt sensitive data and transactions around the world.

Cryptocurrency is technically just digital coins, each with its own encrypted code. It’s reliant on on the internet to set its value and every transaction is confirmed and becomes a matter of public record. This helps prevent the same digital coin being duplicated. Users can make Bitcoin deposits, payments and Bitcoin withdrawals easily online to turn their ‘real’ cash into crpytocurrency.

HOW DO CRYPTOCURRENCIES WORK?

Cryptocurrencies work by using dispersed technology that allows the users to make secure transactions and save money without using their names or going through a bank.

HOW ARE CRYPTOCURRENCY RECORDS MANAGED?

A digital public ledger known as a blockchain is responsible for keeping all transaction records. Even though the information is public, it is not susceptible to manipulation by hackers. Every record is stored safely in a block and these blocks are sent to the network where they are linked together to form a blockchain. It must first be accepted as a legitimate transaction to be included in the blockchain. These blocks cannot be altered in any way once it has been confirmed.

HOW CAN I PURCHASE CRYPTOCURRENCY?

Cryptocurrency is a very volatile market with exchange rates that constantly alter, daily or even hourly. Bitcoin is one of the most well-known and appreciated cryptocurrencies available but there are also cryptocurrencies like Litecoin, Peercoin and Dash available.

If you transact with cryptocurrency, you will be provided with a digital key to the address of that currency. You may then use this digital key to access and authorise your transactions. These digital keys must be kept safely, which is why it is of utmost importance to have a cryptocurrency wallet.

There are many cryptocurrency wallets available for you:

1.            Desktop wallets

2.            Online wallets

3.            Mobile wallets

4.            Hardware wallets

HOW CAN CRYPTOCURRENCY BE USED?

There are many uses for cryptocurrency today, here are a few ways that you may use yours:

1.            Coffee – In 2018 Starbucks confirmed that it would be allowing payments from the Bakkt app, which accepts a number of different crypto coins.

2.            Décor and other household good – Overstock, a well-known online company announced in 2014 that it would now be allowing its customers to make payments using bitcoin.

3.            Gift cards – popular site eGifter.com offers uses the chance to purchase gift cards that can be used at over 250 different stores, using crypto like Bitcoin.

Cryptocurrency is becoming more widely recognised in the world and with many service providers online. It is gaining credibility as one of the most trusted payment methods for many people the world over. I hope that this blog post has given you an insight into this new know of digital payment and please do share your own experiences of using cryptocurrency in the comments below 🙂



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Cassie is a freelance writer with a Masters degree in lifestyle promotion studies. She loves to 'get the look for less' so regularly shares thrifty fashion posts, DIY interior design ideas and low-cost recipes on her blog.

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