Cryptocurrency has become a worldwide phenomenon and a number of people are aware about it.This year it has been expected that investment in Cryptocurrency will lead to more revenue. Almost every person has internet access today, which has increased the investment in Cryptocurrency.
Virtual coins are identified as the decentralized electronic form of currency that in reality does not have any existence in physical form. These are distinct forms of digital money that follows encryption method for making the secure transaction and put a control on making new units.
A digital currency such as virtual coin has caused a financial turmoil and is a collective agreement of every other computer on virtual coin network. The transactions should be fully secure and private with the help of a digital key.
So if you are in a desire to own a virtual coin actually, following are the choices available:-
1) Virtual coins are made by using complex mathematical equations which is checked by several users called “Miners”. A miner has an involvement in investing a lot of money in computers as well as electricity bills. This value can be larger than virtual coins that an individual actually earn.
2) Simply purchase a virtual coin from any other person using the conventional money, mostly through a Cryptocurrency exchange platform.
Working of Cryptocurrencies
Cryptocurrencies are the virtual currencies that can be earned or bought. These are issued & managed as per the predefined rules which are very specific to each Cryptocurrency. For instance, issuing of the new virtual coin is based upon a mining algorithm that is run out by the people known as miners using computers. For services exchange, miners are given the virtual currency units awards. So, any individual who wishes to obtain its units without taking part in these mining activities should buy them.
Cryptocurrency has the following two keys: –
1) Public Key: – This gives the existence confirmation and unique identity of the virtual currency unit.
2) Private Key: – It is equivalent to a secret code which is recorded in a digitized wallet.
After the set-up of a digital wallet using distinct software which is designed for Cryptocurrency trading platform, users have the facility to purchase goods or services, and even investment or transfer of digital currency. Such transactions are pseudo-anonymous because of the keys utilization.
While making a payment, virtual currency owners can check their currency unit with a private key. The transaction then gets submitted to a network of miners that confirm the ownership of virtual currency unit, validate transactions and then pass it to the new owner.
Cryptocurrency – Functioning as Money
Cryptocurrencies can be considered as virtual currencies if it has the accessibility to serve the following functions of money: –
- Acceptance of Cryptocurrency is limited but at some level, it can serve as the medium of exchange. Two parties can undergo transaction in it as well as in any other medium.
- Virtual coin, a digital currency is a valuable asset. It is possessed under the “digital wallets” system which has an expensive maintenance and vulnerability to hackers.
Purchasing of your first virtual coin
Purchasing a virtual coin creates a lot of confusion in the minds of people. Such coins attract more and more people around the globe. Cryptocurrency is the exchange and trading platform built up for creating smart contracts that run in a programmable manner without any kind of fraud, censorship or some type of third party interference.
After account verification, the number of payment methods can be added like credit cards, debit cards etc…
Benefits of Cryptocurrency
Following are the advantages of virtual currency such as: –
1) Similar to the precious metals, Cryptocurrencies provide inflation protection.
2) They provide reliable means of exchange that are attractive to the individuals.
3) Virtual currencies are having comparatively lower cost as compared to traditional electronic transactions.
4) Transactions are free of cost or with a very small amount of fees. Sender and recipient location doesn’t matter in this case.
The Bottom Lines
Virtual coins continue to lead the pack of Cryptocurrency with respect to market capitalization, user base & popularity. Virtual currencies are being used for the enterprise solutions and are becoming popular day by day. Some of the virtual coins are being endorsed for superior characteristics.
Virtual coins have shown to the world how Cryptocurrencies can act as a valuable asset. Globally, it has been adopted as a viable payment method and the chance for those having designing skills, development or cyber security.
Robert Bint is a senior editor at Bitex.Global; which is the pioneer in cryptocurrency trading & exchange. He enjoys creating, uncovering and disseminating new and interesting perspectives in the cryptocurrency trading industry.