I was sick of being the dumb one in the room, knowing little to nothing about crypto currency, so I got to work – here’s a cheat sheet.
The simple truth is below… Answers to all the questions you don’t want to ask in public.
What Is Cryptocurrency?
Cryptocurrency is “a type of digital token that relies on cryptography for chaining together digital signatures of token transfers, peer-to-peer networking, and decentralization.”
This is different than a Virtual Currency which is “a type of unregulated, digital money, which is issued and usually controlled by its developers, and used and accepted among the members of a specific virtual community.”
What Kinds Of Cryptocurrency Are There?
Bitcoin is the first, and most well known, cryptocurrency. There are more then 740 different cryptocurrencies out there.
Currently, only around 25 of them have a market capitalization, meaning a market value of a company’s outstanding shares, over 10 million dollars.
Some other major cryptocurrencies are Litecoin, Ethereum, Zcash, Dash, Ripple, Monero.
How Do You Get Cryptocurrency?
In order to obtain cryptocurrency, you must visit (and likely register) at an online crypto currency exchange.
A Cryptocurrency exchange is a website where anyone can buy, sell or trade cryptocurrencies for regular currency such as the Euro, US Dollar, or English Pound.
There have 3 types of exchanges available to purchase cryptocurrency…
Trading Platforms – These are websites that connect buyers and sellers and take a fee from each transaction.
Direct Trading – These platforms offer direct person to person trading where individuals from different countries can exchange currency. Direct trading exchanges don’t have a fixed market price, instead, each seller sets their own exchange rate.
Brokers – These are websites that anyone can visit to buy cryptocurrencies at a price set by the broker. Cryptocurrency brokers are similar to foreign exchange dealers.
Usually, you will need to open an account and verify your identity.
Once you belong to an exchange you can create a virtual wallet where you will be able to store and use any cryptocurrency you purchase.
Coinbase, Kraken, Cex.io, Shapeshift, Poloniex, Bitstamp, CoinMama, Bitsquare, LocalBitcoin, and Gemini are all notable cryptocurrency exchanges.
How Do You Pay For Stuff?
Once you sign up for an exchange and create your digital currency wallet you can buy and sell by connecting a bank account of your choosing.
Simply log on to your exchange or enter your app and hit the “buy” or “sell” functions. You may purchase or sell you cryptocurrency at current market value.
Depending on the exchange or app your money will be deposited in your account with a few days or so, however long the exchange or app specifies.