A cryptocurrency or crypto is a digital currency and you can also be called a digital dollar or digital INR as instead of paper money, it uses an online catalog for transactions. They provide a medium of exchange and allow people to directly or Instantly make payments to each other.
Bitcoin is a kind of cryptocurrency and is a digital document of money that was invented in 2009 by an entity named Satoshi Nakamoto. How cryptocurrency works is on a technology called Blockchain which provides a peer-to-peer network and dealings are recorded on the blocks of the blockchain.
The decentralized qualities of the blockchain make cryptocurrencies resistant to the ancient ways of administration control and interference. Transactions are secured as the technology uses cryptography and are validated using a consensus mechanism such as Proof-of-stake. Various computers that are combined to a blockchain confirm marketing on the network utilizing these consensus mechanisms.
Upon thriving confirmation of transactions, these dealings are grouped and chained together as blocks in the blockchain. This process of making new blocks is understood as mining and the people accomplishing it are named miners. Miners are awarded for their action and resources expended on mining, in the state of crypto retaliation. Hence, the technology delivers an encouragement for individuals to support the blockchain and establish its authenticity.
The technology is such that it provides:
Transparency of transaction data
Faster transfer of payments
Lower transaction costs
Why cryptos are a method to solve the digital currency issue is that they are making a new course towards cashless economizing and apart from prices they provide several other use-cases. Bitcoin is the biggest cryptocurrency with a current price of $45,000 and what makes Bitcoin so worthwhile is its limited supply of 21 million, unlike fiat currency.
Ethereum, the second-largest cryptocurrency provides various other use-cases such as Decentralised Finance (Defi) and Non-Fungible Tokens (NFTs) which have grown in popularity as it empowers individuals, removes intermediaries such as banks and financial institutions and allows different parties to deal directly with each other.
How to make money with cryptocurrency is by investing and trading in cryptocurrencies just like investing in stock markets. One should carry out thorough research before investing and choosing a coin as the prices are dependent on fundamentals and the various use-cases it provides. While choosing which cryptocurrency to invest in:
Understand the basics of blockchain and crypto
Follow the markets and keep a track of which cryptocurrencies are performing well
Open an account on a crypto website or an investment app such as CoinDCX Go, Binance, the simplest Bitcoin app
Select crypto and start investing
Users can buy a cryptocurrency such as Bitcoin at a certain price and then sell it later at a higher price, making significant returns. Cryptocurrencies can be bought on many bitcoin and cryptocurrency apps such as Binance and exchanges.