A cryptocurrency is a digital or virtual currency that uses cryptography for security. A cryptocurrency is difficult to counterfeit because of this security feature. Cryptocurrencies are called ‘dark internet’ or ‘another internet world’ for the complexity attached to it. The first cryptocurrency to capture the public imagination was bitcoin, which was launched in 2009 by an individual or a group under the pseudonym Satoshi Nakamoto. Since then, numerous cryptocurrencies have been created.
Why its gaining popularity?
No matter which cryptocurrency one would have invested last year, the returns would have been astronomical.
If one is serious about trading or investing in
cryptocurrencies, the way to go about can be having a diversified portfolio of
cryptos with higher weightages for bitcoin and ethereum and minimal weightages
for other emerging crypto currencies. To choose which crypto currency to invest
in, one has to study the underlying blockchain technology and see if it is
superior to others, and also check if some of the recognised companies and
institutions are accepting the cryptocurrencies. Wider the acceptance, lower
the risk in investing in a cryptocurrency.
Source: DSIJ, Wiki, Investopedia
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