Cryptocurrencies are now a frequent topic of conversation; either by marketing campaigns in digital spaces or by the suggestion that “they are the future of finance”.
The best known are Bitcoin or Ethereum, but there are others such as Binance Coin, the third largest cryptocurrency according to data from CoinMarketCap. In 2017 Changpeng Zhao founded it in China to later move its headquarters to Malta, following the growing regulation of cryptocurrencies in the Asian country.
This cryptocurrency can be used to be exchanged for other cryptocurrencies such as bitcoin and to pay fees within the Binance Exchange platform. Customers who pay with it within the platform receive a discount as an incentive. Binance has a maximum limit of 200 million tokens, although it applies alternatives every quarter; by using 20% of its profits to “burn” binance coins, it reduces the total supply and stabilises their value.
The fourth cryptocurrency, according to its market values, is Cardano; it is named after Ada Lovelace in honor of a 19th century mathematician recognised for being the first computer programmer. This cryptocurrency can be used as a native token within Cardano, an open blockchain platform that is overseen by the Cardano Foundation that was created in 2015 by Ethereum co-creator Charles Hoskinson.
Cardano uses a proof-of-stake (PoS) system which consumes much less energy, unlike bitcoin and ethereum, which use a proof-of-work system for mining coins. “Cardano, for example, is 1.6 billion times more energy efficient at the moment than bitcoin” published by Forbes.
Another existing cryptocurrency is Dogecoin, which according to its website, is “the fun and friendly currency of the Internet.” It was created as a joke in 2013 by software engineers, Billy Markus and Jackson Palmer, the latter was the one who bought the domain dogecoin.com in allusion to the meme “doge”, the most famous Shiba Inu on the Internet. On dogecoin.com, their mascot has a title: “Dogecoin is an open source peer-to-peer digital currency that is favored by Shiba Inus around the world”.
If you are also wondering how to buy cryptocurrency, then you’ll be pleased to know that there are several options. There are platforms and exchanges where you can pay by credit card, PayPal or bank account. Nowadays, it is easier than buying a product on Amazon.
Unlike bitcoin, which has set the number of coins available in the market at 21 million, dogecoin has 129 billion coins in circulation and will make new blocks of coins available for mining every year. This is one of the reasons why dogecoin is valued at approximately 40 cents, while one bitcoin is worth approximately US$ 42,000. This coin is also popular within the Reddit community, who have taken on an investor role skyrocketing its value. However, dogecoin is subject to extreme volatility, so its value could drop without warning.
But how to buy any of these cryptocurrencies? The first thing is to know how to identify good times to invest in them, which requires study and a bit of intuition, and to determine when to enter the market and invest an amount that allows profitability without putting your assets at risk. It is necessary to be able to identify the best investment proposals in cryptocurrencies, they are mainly related to blockchain technology.
Differences between regions also determine these decisions by investors, who must analyse existing regulations. For example, to buy cryptocurrency in the UK, one must take into account what is stipulated by the first self-regulatory trade association for cryptocurrencies that was founded in that country. This self-regulatory code aims to raise industry standards, at least in the UK, which means that end consumers will be able to operate with greater protection.
These new strategies that regulate an area as new as it is immersed in uncertainty and potential, are important steps if we seriously consider the idea that cryptocurrencies are the future of finance, which is materialised with proposals such as those of Mastercard and Visa, who recently announced that in the near future they will allow their customers to pay with some cryptocurrencies.
The above information does not constitute any form of advice or recommendation by London Loves Business and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Appropriate independent advice should be obtained before making any such decision. London Loves Business bears no responsibility for any gains or losses.