Cryptocurrencies are increasing in value and acceptance and there’s millions to be made trading and/or mining.
When the first 50 Bitcoins were mined in 2009, they were known only to a few and had no real worth. The value, early on, was negotiated at a transaction by transaction basis on online forums, such as the famous 10,000 being used to buy 2 pizzas. Today, a single Bitcoin, at the start of writing this article, is worth $8622.89 and its value continues to grow logarithmically, with no signs of slowing down.
What are cryptocurrencies?
Bitcoins, and other cryptocurrencies, are usually “mined” using specially designed computers but any computer could technically do it. To simplify the process, the computer connects to the network of a currency, encrypts data, and as a reward, miners are given cryptocurrency, with more powerful computers usually being able to mine more in the same duration of time. These currencies have a fixed total, with the last bitcoin estimated to be awarded in 2140, and, as such, the value should increase until then. Because cryptocurrency transactions are tracked across the network, it’s near impossible to gain more through fraud, and it becomes harder to cheat the system over time.
What cryptocurrencies are out there?
Currently, the most popular and well-known cryptocurrency is Bitcoin, but with a single coin being valued at the thousands of dollars and countless people mining it, it can be intimidating to get into. More recently, other cryptocurrencies have begun to see success such as Litecoin and Ripple but arguably the biggest contender is currently Ethereum. Ethereum saw backing from many major banks, tech giants and other organisations earlier this year and has grown from being valued at just $9 per ether at the start of this year to $480 this month, seeing far greater percentage growth than even Bitcoin.
How do I invest?
The easiest and most simple way to make money from cryptocurrencies is to bet on their growth which can be done through the same channels as stock and regular currency trading. However, the arguably safer and better option is to exchange them to a digital wallet. Most cryptocurrencies have a wide variety of wallets available and the advantages include being able to store them online, on a digital storage device or even on paper and the coins themselves being owned directly by you. The most popular wallet is currently Coinbase but many alternatives exist. The most complex but potentially rewarding method is to mine the coins yourself. Many applications exist for this and they vary based on operating systems, hardware and cryptocurrency.
Cryptocurrencies continue to grow in value and popularity and many speculate that in the coming decades they will become the norm, possibly even replacing paper currencies altogether in the far future. Regardless of the long-term possibilities, I’d argue that nothing is more persuasive than the fact that since I started writing this article, Bitcoin has risen $106.11 to $8729.
AUTHOR: A student at University of Kent, Canterbury – 26 November 2017
WARNINGS: (1) Nothing in this article should be attributed to any company within the Corporate Governance Group of companies, and the opinions expressed are not necessarily those of those companies. (2) We, the Corporate Governance Group of companies, are not recommending investment in cryptocurrencies, nor recommending any investment other than in our own parent company Corporate Governance Group Limited, which plans to float on NEX Exchange in 2020.