A cryptocurrency is a digital currency that is based on the technology Blockchain. A cryptocurrency is decentralized. It is possible to transfer a cryptocurrency to others because the network confirms that you can make the transfer. Today, a cryptocurrency can also be used for smart contracts etc.
If you are completely new to cryptocurrencies, there are many new concepts you need to master. We will review many of these concepts. If there is something that you do not get an answer to, you are always more than welcome to leave a comment, because that way we have the opportunity to constantly make the content better. With Global CTB you can have the best brokerage option.
A cryptocurrency consists of 2 things:
- The currency itself and the underlying blockchain technology.
- The first is a basic financial instrument, while the second is an IT technology with great potential.
- Let’s start by digging a little deeper into both to understand the investment opportunity in cryptocurrency.
Have you ever thought about how to make a currency? The definition of a currency is a monetary system used in an area. The most common currencies are governed by central banks or nation states, as almost all countries have very strict legislation in this area.
- In the early 1800s, for example, it was both legal and very common in the United States to make its own currency. Therefore, cities, banks, railways, churches and many others made their own currency. The peak was reportedly reached in 1860, when there were more than 8000 different currencies in the United States. Then came new legislation banning currencies other than the dollar.
In the past, the currency of most countries had an underlying value such as gold. However, it has always been a problematic system, e.g. if other countries demanded to have your currency exchanged for gold. Therefore, the United States removed this direct link in 1971, and ever since, the amount of dollars in circulation has instead been regulated through legislation.