How to Use & Invest in Cryptocurrencies

The best way to start talking about cryptocurrencies is to mention the word Bitcoin . If you do not know exactly the matter, surely you have at least seen or heard the term, it is in many places.

Other related words would be: Ethereum, Litecoin, Ripple, Dash, Dogecoin, Zcash,   AntShares, Monero.

All are cryptocurrencies, crypto currencies or digital currencies. Three identifying terms that usually mention the same subject, with some differences and specificities; but enrolled in the same conceptual philosophy and use. They are digital means of exchange.

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Is it really that important to understand and understand cryptocurrencies?

I can assure you that knowing about this topic is relevant. And you will not have to be any type of entrepreneur, small or medium entrepreneur so you should inform yourself about this field.

The more you are, the more you will be told that you have to update yourself; It's too outstanding to let it pass.

We will be developing shortly a summary but practical exhibition of some types of cryptocurrencies and useful tips to invest in them.

It is an intrinsically valuable and even exciting issue we could say, that it is worth paying attention to, even if you do not plan at the moment to invest or make use of it.

The point is that you may need it at any time, it could even be determinant in particular circumstances that you may face soon ; in the midst of a changing world, where we have to adapt constantly due to different crises and circumstances, and this at any level or level: personal, family or institutional.

Why cryptocurrencies are born, triumph and move forward?

Because of its importance we are going to invest space in this post, to refer to these primary and fundamental issues before entering into the topics that we want to emphasize the most.

Let's evaluate now why cryptocurrencies arise and succeed.

In 2009, Bitcoin started operating, which was the first cryptocurrency. Since then many others have appeared with specific characteristics and particular protocols, but very similar to Bitcoin.

We already mentioned some: Dogecoin, Monero, Ethereum, Litecoin, Ripple, Dash, Zcash,   AntShares.

Let's see some benefits of using Bitcoin, since it is the cryptocurrency of reference, and we can understand its value and why digital currencies have triumphed.

Taking Bitcoin as a reference, we see that:

• It does not belong to any particular country or state , for this reason it can be used globally.
• Like any other currency, it can be purchased with specific currencies, such as euros, etc. The opposite case is valid equal.
• When someone uses it, it will not be necessary to reveal the identity and therefore privacy is preserved. There will be security for both buyers and sellers. You will not have to provide confidential and sensitive information such as card numbers or bank accounts.
• The intermediaries do not exist, transactions will be made from person to person, directly.
• It is not controlled by any State, company or financial institution, therefore it is decentralized.
• It is not possible to duplicate or falsify it, because it has a highly sophisticated cryptographic system.
• Your transactions will be irreversible.
• The money will be totally belonging to who owns it, no one can intervene or freeze an account in any way.
• Its immediacy is amazing, it can be sent to any region of the world in an expeditious manner.
• The costs are greatly reduced because there will be only intermediaries, therefore the fees or commissions resulting from this fact will not exist. The money will go from person to person, from one individual to another, or from a buyer to a seller.

Have you seen how outstanding are the possibilities offered by the use of this first cryptocurrency that existed?

So many reasons for it to have gone ahead, and also for other cryptocurrency to emerge.

Types of Cryptocurrencies

Let's talk about the most important cryptocurrencies and some peculiarities of them.

Bitcoin:

We already know that it is the cryptocurrency of more relevance and the first emerged, it must be taken as a reference.

In the previous section we commented on its characteristics. We will only add that it   has a total limit of 21 million Bitcoin and this figure can never be exceeded, in this way it has been established by this market.

In recent years it has grown remarkably and reached its value close to 1,000. Nowadays, each unit ranges between 400 and 500 dollars.

Ethereum

It will not compete directly with Bitcoin, but complements it . Meanwhile a blockchain will control the ownership of the Bitcoins, this other currency will run with security programs that will only be executed in the applications of the users.

Many people will use Ethereum in order to create crowdfunding platforms (personalized - reliable) and online organizations that will be autonomous. They are decentralized applications and can only be built on the Ethereum network.

Litecoin

It works very similar to Bitcoin but its value is a bit lower (84 million Litecoin in existence). It will be easy to get and very mobile from person to person. Very useful and easy to use for those who are new to the world of cryptocurrencies.

It presents a downloadable portfolio from its official website with total encryption. For those who want to move very small amounts of money is a recommended network, very simple and easy to use.

Ripple  

It is a cryptocurrency that focuses on the relationship with banks . It allows them to make worldwide payments in a fast and less expensive way, allowing cross-border transactions with fewer intermediaries. Ripple will allow a more fluid and direct operation.

Dogecoin 

Its reference system is the Litecoin, this unlike most other cryptocurrencies for which Bitcoin is. It allows a block generation very fast, practically one per minute.

It has the capacity therefore to carry out around 40,000 transactions daily. Very popular as of 2014, being widely used to make donations to non-profit organizations such as NGOs etc.

With a market value of around 0.00015 dollars per unit.

Dash

Used to make transactions between consumers, very convenient to buy.

In many businesses Dash is accepted, with a very fast transaction, without the need to wait so long to visualize the payment charge. Similar to any cryptocurrency, it is possible to buy Dash and keep it in a portfolio. There is the possibility of adding a business to the commercial map of this cryptocurrency.

Monero

With great advantages for users who need to strengthen their privacy . Those who operate with this cryptocurrency individually, will have total control over their money. There will be the possibility for those who choose to use this currency, to choose who can see or not where their money goes.

Tips for investing in Cryptocurrencies

Now we are going to talk about soundness in the possibility of investment in Cryptocurrencies.

See for yourself what we would recommend for those who start.

• Do not believe any sensationalist story that is published , whether success stories or failures.
• You have to understand as much as you can in a logical way the operation of cryptocurrencies. This will help you assess how risky your money is.
• Try to understand how bitcoin and blockchain work, not everyone does it. It will allow you to clarify and answer many questions that will influence your operational skills and decision making.
• Diversify: Do not concentrate only on Bitcoin. As we have seen there is a wide variety of cryptocurrency, many with very interesting features that work very well when Bitcoin falls.

Diversifying your funds will be a risk management technique.

Extreme precautions, cryptocurrencies are something new and their volatility can be extreme, it is undoubtedly a space of risk. A good rule and control mechanism would be "Just invest what I could afford to lose"

Study the diversity of investment strategies that exist. We can affirm that the tendency to succeed is in those that are more conservative.

Ex: "Dollar cost averaging": This is a strategy where a similar amount of money is invested in a joint investment every month or week.

Example: it is known that bitcoin is very volatile and this terrifies many investors. If it falls a lot it does not mean that the disaster will remain.

There is a well-known bitcoin investment strategy called "hold" where the investment will be withheld, without assessing the volatility of the market.

You could buy and not be so aware for a while of market movements, in order not to despair and sell.

We recommend studying all the strategies and choosing carefully the variants that will be used.

The currencies should not be stored in exchanges: Once a coin is purchased, it is advisable to take the money out of the exchange and move it to a portfolio that you can only control, equal to a hardware portfolio.

The world of cryptocurrencies is undoubtedly exciting, but also complex and not infrequently confusing. Sometimes it can even generate panic in those who have invested when the media highlights not encouraging news, and this for different reasons; as country positions or computer regulations.

Many have even thought about this beginning of 2018 that the bubble has exploded in cryptocurrencies, however another sector considers very seriously that the current fall trend is an opportunity to buy in the long term.

Let's not lose sight of digital currencies. They are already ours, and they are here influencing the world economy, we have only to live with them, understand them and adapt.