Over the last few years cryptocurrencies have become extremely popular due to the high rates of return they generate.
Supporters of the technological revolution believe that cryptocurrencies provide an exceptional opportunity to get rich. Opponents, on the other hand, are of the opinion that this is a temporary trend which soon will end in a crash of all cryptocurrencies. What are cryptocurrencies? To answer this question, it is worth starting by discussing the evolution of money. Thousands of years ago, people exchanged goods through barter, which is the exchange of one asset for another. At a certain point in time, money based on gold was introduced for good into trade, which, as a limited-access ore, was a value in itself. Money based on gold allowed people to buy various goods and services. This type of activity entailed unification of trade and reliable valuation of goods. Over time, cash money was introduced to facilitate trade, as a pouch full of gold coins was replaced by a wad of banknotes. The next stage was electronic money, which, together with payment cards, made it possible to replace physical cash.
Cryptocurrencies are an electronic means of payment, created by IT specialists, which are based on cryptography. Since they are not issued by any central bank or controlled by any supervisory authority, cryptocurrencies are not recognised as an official means of payment by financial institutions. The creation of cryptocurrency is a direct result of disapproval of financial institutions and their monopoly in the twenty-first century. The most prevalent instrument among the cryptocurrencies is Bitcoin (more info about BTC) which is becoming increasingly popular due to its huge capitalisation. The strength of this cryptocurrency is reflected in its rates of return. Over the last 5 years, the value of this instrument has increased by more than 55,0000%. The history of the Bitcoin currency dates back to 2008 and the enigmatic person who allegedly created it. To this day it is still unknown who the creator of Bitcoin is and whether it is one person or a group of people. For years, the creator of the first cryptocurrency has been completely anonymous, hiding under the pseudonym Satoshi Nakamoto.
The creator of Bitcoin is still unknown
At the moment there are more than 900 different cryptocurrencies which are of different interest to investors and speculators trading in cryptocurrencies. Apart from Bitcoin (learn more), Litecoin, Ethereum and Dash are also popular. A number of other instruments from this group are being created, however, their market share is insignificant. Time will tell whether the currently created cryptocurrencies will achieve a spectacular success, comparable to that of Bitcoin.