There is a lot of buzz surrounding cryptocurrency bitcoin and its underlying component the blockchain, boasted as being a revolutionary technology in money. The now popular bitcoin was the first coin introduced in 2009 which started at a value of less than one US dollar and since has risen to an astronomical value of over US $2,500 as of this writing. It is important to note that you are not required to buy bitcoins as a whole, bitcoin can be purchased in any fractional quantity. You can buy a half, a quarter or even 1 thousandth of a bitcoin.
With all this appreciation since Bitcoin's inception, a lot of attention has been drawn to the new cryptocurrency market space. With bitcoin enjoying the spotlight as the frontrunner coin, there is a new coin on the horizon called “Ethereum” which is predicted to possibility surpass bitcoin in value. Sporting an array of new technologies that promises to solve issues with bitcoin, Ethereum also extends the underlying technology behind bitcoin, the blockchain to now offer a platform for developers to build what are called web 3.0 applications(smart contracts, decentralized apps, or DApps, the types of apps that run on the Ethereum blockchain platform) giving intrinsic value to Ethereum.
Since the success of bitcoin as a cryptocurrency, many cryptocurrencies have since came on the market using or improving on the blockchain technology. Alternate coins(alt coin) to bitcoin includes; Ethereum which opens up the blockchain to allows apps to run on it, Litecoin which is referred to as being silver if bitcoin is gold, and “ANTshare” now called “NEO” which is referred to as the Chinese version of Ethereum. Along with these three notably mentioned coins there are tons more in the cryto marketspace, see www.coinmarketcap.com for a list of these other coins.
First one might ask where can I buy these coins, the answer to that would be at an “exchange”. An exchange is a place where you can buy and sell cryptocurrencies. Some exchanges include www.coinbase.com, www.bittrex.com, bitstamp.net, poloniex.com, kraken.com and gemini.com. As exchanges are used to buy and sell cryptocurrencies, “Wallets” are used to store your digital currencies in a safe place.
You can have a wallet for every different type of digital currency you have. Associated with every wallet are two wallet ids, one for sending and one for depositing funds to and from that wallet. A wallet can be in several forms, a web wallet, soft, hard or physical(actually writing your ids on paper) wallet. All exchanges will have a wallet for the currency type you hold with them on the exchange. As a word of caution, many crypto pros recommend transferring your coins to your personal wallets since the exchanges are centralized and are susceptible to technical failures and malicious attacks. A quick search on the internet can show you available options for setting up your own personal wallets.
Crypto currencies are gaining more traction and attracting mainstream investors and financial experts. With all this new attention to the cryptocurrency market comes the opportunity to capitalize on this lucrative opportunity. There are several different ways that you can make money within the crypto market space.
One way to make money within the crypto market space is through “mining”. Mining is pretty much setting up your computer to work for you processing bitcoin transactions and earn these coins as a commission in the process. This is made possible under a protocol in cryptocurrency called “proof of work”. Imagine setting up your computer to work and earn 1 bitcoin that is worth approximately US $2,500.
When bitcoin started out you could mine bitcoin with just a simple laptop laying around your house, now that has changed. The difficulty level that is associated with cryptocurrency processing is programmed into the system to increase exponentially over time thus rendering otherwise useful equipment incapable of mining as much coins in the future. Mining equipment progressively got outdated, started from CPUs, then GPUs(mining with graphics cards), now most mining is done with expensive application specific interfaces(ASICs). It is important to note though, some coins are still worth mining without too large of an investment. There are several companies that offers alternatives to setting up your own mining hardware, two of these companies are www.genesis-mining.com and coinomia.com
With the high rates of appreciation with cryptocurrencies these digital coins are viewed as a store of value and a lot of investors are flocking to the crypto market to get a return on their money. One year ago July 1, 2016 one bitcoin was worth US $683.85, now one year later today the same bitcoin is worth approximately US $2,500 with a high peak of US $2,900 on June 10th, 2017. Similarly alt coin Ethereum that is expected to surpass bitcoin in value, in the same year ago was worth US $12.18 and now is worth US $267.61 with a high peak of US $380.28 on June 13th, 2017.
As with anything that goes up, it can also go down. Bitcoin and Ethereum has risen to a substantial amount of dollars, alternately you can buy lower priced coins, even coins that cost pennies or even less than a penny. You can buy and hold these coins for the long term(a year or more) or for the short term(like within a couple months). Before making any investment in cryptocurrencies, always arm yourself with information about the stability and the idea and concept behind a coin before you take any investment action in that coin. It is also important to note where and who you are getting your information from as the crypto market space is not regulated, do not get caught in a pump and dump trap.
Another aspect of making money in the crypto market space is by trading, referred to as day trading in the stock market. With the high volatility that Bitcoin, Ethereum and other coins are experiencing brings an opportunity to buy and sell coins in the same day or two and make a profit. Here again we see that having a lot of information about the coins will allow you to make the best decisions and maximize your profit margins. If you are coming from an investing and financial background this will be a plus as you can use charting and statistical tools to gain an insight on the coins to buy, optimal times when to buy and the best times to sell in order to secure a profit. Keep in mind that based on your location your profits could be subject to taxation.
In the stock market there is initial public offering where a company offers its share to be traded on the public stock exchange. The same is offered in the crypto market space with initial coin offerings(ICOs). The purpose of these new coins are often to solve unique problems another cryptocurrency fell short on or another purpose is just for companies and individual to raise funds for their companies or fund a new idea. Whatever the purpose is, again, arm yourself with as much information as you can before making an investment as new coins are coming on the market ever so often.
If you offer any kind of valuable content to the internet or on any social media platform you can solicit donations to any of your digital currency wallets to build up your cryptocurrencies. If your audience finds your content useful and valuable enough they just might reward you with sending you a portion of a bitcoin or even an Ethereum coin.
Additionally, along with soliciting donations, several sites like Coinbase and Genesis Mining gives you the ability to refer your friends and people you know and for that they will reward both you the new customer with digital currencies. All you have to do is place your referral links and codes on your site and your social media posts and encourage your audience to use your links to sign up for the referred product or service. In the event you are already selling goods or services on the internet, you can build up your cryptocurrency holding by start accepting digital currencies as a form of payment on your site.