In present time Cryptocurrency is getting very popular in the world . Cryptocurrency is the hot , new trend for investment in many countries. Now people are investing their capital in Crypto currency for earning more profit in compare to stock market. If you are also interested to invest in cryptocurrency then do some research or study related to this investment idea it will help you in your crypto investment journey . First understand What is Cryptocurrency is ?
What is Cryptocurrency
A Cryptocurrency is a form of digital asset based on a network that is distributed across a large number of computers . This is decentralized structure allows them to exist outside the control of governments and central authorities.
Cryptocurrency is a form of payment that can be exchanged online for goods and services. Many companies have issued their currencies , often called tokens , and these can be traded specifically for the good and services that the company provides. Think of them as you would arcade tokens or casino chips. You will need to exchange real currency for the cryptocurrency to access the good or services.
Cryptocurrency work using a technology called blockchain. Blockchain is a decentralized technology spread across many computers that manages and records transactions. This is also for the security of this technology .Blockchains, which are organizational methods for ensuring the integrity of transaction data , are an essential component of many cryptocurrencies .
So now you will understand what Cryptocurrency exactly means. Many people in India wants to invest their money in Cryptocurrency and wanted to increase their money . Are you also thinking to invest your money in Cryptocurrency , but you have lots of doubts about –
1. Status of Cryptocurrency in India – is it legal or not ?
2. Types of Cryptocurrency ?
3. How to invest in Cryptocurrency ?
4. How it works ?
5. How much money you need to invest in this ?
6. Investment In Cryptocurrency is safe or not ?
1. Status of Cryptocurrency in India – Is it legal or not
As we now Cryptocurrency is fast gaining ground as an exciting option among investors in India. The past few years have seen a burgeoning numbers of investors and analytics suggest that it isn’t just city slickers – most of its recent users come from small cities and towns in India .
However, despite the huge excitement of investors , much ambiguity persists around the legality of Cryptocurrency in India. So if you are thinking to invest in Cryptocurrency , you want to be sure that you are not breaking any law or regulations.
Cryptocurrency is somewhat like the internet which is free and it used by billions of people around the world yet no country owns it or controls it . They are not issued by the central bank of the country (like RBI in India ) as a legal tender. There are no laws that prohibit or allows trading in Crypto. So cryptocurrency is like any other asset class such as gold , commodities . Many people trade in gold without government creating law for it . Same is the Status of Cryptocurrency at the moment in India .
Cryptocurrency is minted across the world by complex decentralised ,peer to peer powerful coded system. Since it can be traded online within the country, cryptocurrencies are digital currencies and valid as an asset class in India.
2.Types of Cryptocurrencies
The two major types of cryptocurrencies are Bitcoin and Altcoins. Founded in 2019, Bitcoin is the original Cryptocurrency. After Bitcoin several other cryptocurrencies were created and all such crypto s collectively called Altcoins.
Other cryptos are : Ethereum, Dogecoin, Cardano , Litecoin, Tether and Ripple etc…
3. How To Invest or Buy Cryptocurrency
While some cryptocurrencies, including bitcoin, are available for purchase with U.S. dollars, other require that you pay with bitcoins or another cryptocurrencies.
To buy or invest in cryptocurrencies, you will need a “Wallet”, an online app that can hold your currency. Generally, you create an account on an exchange and then you can transfer real money to buy cryptocurrencies. Also, a growing number of online brokers offer cryptocurrencies.
4. How It works
Cryptocurrency runs on blockchain technology. A blockchain is simply a digital ledger of transactions. This ledger or data base is distributed across a network of computer systems. No single system controls the database. Instead, a decentralized network of computers keeps a blockchain running and authenticates its transactions.
Rational crypto investors buy a digital asset if they believe in the strength and utility of this blockchain.
Cryptocurrency transactions are recorded in the perpetuity on the underlying blockchain. All the batches of transactions are recorded on the shared ledger, which is public. Anyone can go and look at the transactions being made on the major blockchain, such as Bitcoin and Ethereum.
Investors in cryptocurrencies don’t hold their assets in traditional bank accounts. Instead they have digital addresses and these addresses come with private and public keys- long strings of numbers and letters – that enable cryptocurrency users to send and receive funds.
5. How Much Should You Invest In Cryptocurrency
The ratio of money you should invest in cryptocurrency is not fixed. Ultimately, the decision is yours and although it depends on market factors, it also depends on personal factors such as your risk tolerance and the amount of money you can afford to invest . In India WazirX is the oldest crypto exchange and it is operational since 2017.
6. Investment In Cryptocurrency Is Safe Or Not
After getting all the knowledge about cryptocurrency one more important question will also rise in your mind that is it safe to invest in the Cryptocurrency. So the answer is YES Cryptocurrencies are highly secure, thanks to cryptography. There are no intermediaries involved in a transaction. Some countries are now thinking to legalize the cryptocurrency .The corporate world is eager to make it mainstream as cryptocurrencies do not have regulatory oversight.
So now you have all the sufficient detail about cryptocurrency. If you are interested and want to invest in cryptocurrency market then go for it but also keep one thing in your mind that this market is a volatile one, so be prepared for ups and downs. You will definetely see dramatic swings in price. If your investment portfolio or mental wellbeing can handle all these ups and down then you can participate in this market. But remember investing in something that’s new comes with challenges, so be prepared for that. If you are planning to participate, do your own research too and invest conservatively to start.
I hope all the information provided in this article about cryptocurrency will help you and if you want ask any thing else about Cryptocurrency then please ask in the comment section.