What is cryptocurrency and how to use it?

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Cryptocurrency has already become a full-fledged part of the new financial world, attracting with its prospects not only numerous private investors, but also big business. The rules of the game in this rapidly growing market are becoming clearer and more transparent every year. But the volatility and specific risks associated with digital currencies have not gone away, and in order to make money in this market, you need to study all its features. Let's try to figure out what cryptocurrency is and how to work with it.

What is cryptocurrency in simple words
Cryptocurrency is a program code, it does not have an offline option. All digital money lives only in the network space. However, they are not backed by gold. Anyone who has enough money to buy special equipment can mine (mine) cryptocurrency, but there are restrictions on the mining of coins, so the rate of digital money should grow.

As everyone knows, in the world of fiat, that is, conventional currencies, everything is different. World central banks periodically turn on the printing press at full capacity, which inevitably leads to inflation. The rates of world currencies are regulated by the states that issue this money. In the crypto world, everything is decentralized, and there is no single control center. The speed of payments and the size of commissions for the transfer of cryptocurrencies are generally lower than in the market for conventional currencies.

The advantage of the crypto world, attracting new and new users to it, can be called anonymity, here it is impossible to find out who participated in the transaction. At the same time, the disadvantages are the same - ultra-high volatility and the impossibility of widespread circulation of digital money in public life due to the scarcity of infrastructure.

How to use cryptocurrency
Before you start using cryptocurrency, you need to think about where to store it. Wallets are used to store currencies. A cryptocurrency wallet is a mobile application, a special program or a separate stand-alone device designed to carry out all transactions with electronic money.

In the digital world, there are five types of wallets: software wallets, online wallets, hardware wallets, mobile wallets, and paper wallets. Let's talk briefly about each of these types.

Software wallets store money on the hard drive of a computer or laptop. Their advantage is a fairly high level of security.

The downside is that storage requires a lot of space: from 150 gigabytes for just one currency.

Online wallets store your digital capital on third-party servers (in the cloud). You can use the money from any device. Mobility Fee - Low Security. Hacking loses all the money.

The same advantages and disadvantages of mobile wallet apps that are installed on phones and tablets. If the phone falls into the hands of scammers, one has to say goodbye to money. Thus, there is no simple answer to the question of how to use cryptocurrency through a wallet.

A much more reliable hardware wallet is a standalone standalone device. Hacking it is hard enough. A clear minus - the device must be constantly with you and remember all the pin codes.

A paper wallet is just a private and public key generated using a special website. It can be written down in a paper notebook or printed, or even better written down in several notebooks at once, because the loss of the key leads to the loss of money.

We buy cryptocurrencies
To work with digital money, you must first buy it. Let us remind you once again what cryptocurrency is and where you can buy it. One of the most common ways to buy bitcoin and other cryptocurrencies is through an exchange. There are many exchangers, and they differ from each other in the size of commissions and ease of use. For example, you can use the exchanger Alligat0r.

Another important aspect is reputation. Scandals happen, and it is advisable not to fall into the same networks as unlucky investors. The network has aggregators of exchange offices that take on this part of the task, collecting reliable resources. But risks still remain, and this fact must be taken into account. As for the technology of exchanging fiat money for cryptocurrency resources, it is practically the same as offline. We choose a course, drive in the details and confirm the deal.

An equally popular way to get cryptocurrency is registration on the exchange. There are two types of exchanges: some specialize exclusively in cryptocurrency transactions, others work with both digital money and fiat currencies.

The selection criteria are the same as when looking for an exchange office: reliability, reputation, speed of the transaction and convenience when working with services. To work with large amounts of money, you will need to verify your account.

Alternatively, a search for a seller of cryptocurrencies through platforms operating on p2p (peer to peer) technology. This is a frequent listing site where sellers and buyers meet. Before making a transaction, you need to check the seller. On such sites, a rating system works similar to the one that is actively used by foreign online stores. But you need to understand that the risks in such transactions are higher than when working with exchanges and exchange offices.