We have recently witnessed a swirl of information around cryptocurrencies. From Elon Musk pushing Dogecoin shares up with a tweet to Tesla investing $ 1.5 billion in Bitcoin, but what exactly are cryptocurrencies?
We could say that it is virtual money that can be used to buy or sell goods. There are different ones and each type of currency has its own virtual wallet, but they cannot be combined with each other. Let’s say it is like a bank account and it is not possible to mix different currencies, such as Euro and Dollar within the same account.
However, it is possible to have different wallets with different cryptocurrencies, each with a different value. There are several sites where you can monitor rates and exchange rates in real-time to find out what value each of the cryptocurrencies has.
Cryptocurrencies do not depend on any bank, there is no physical money and all transactions are carried out remotely through the internet.
The model in which the cryptocurrencies are is made so that they can be transacted between pairs; For example, if you take an English class, you can pay your teacher from your wallet to theirs using cryptocurrencies.
But adoption has not reached that point, although there are companies that allow quick and easy settlement of cryptocurrencies to fiduciary money, such as pesos or dollars. In fact, Tesla made it official that in “the near future” they will accept payments through Bitcoin so that people buy their cars and services, this after the company, owned by Elon Musk, announced that during January 2021 they invested 1,500 million of dollars in Bitcoin.
If you want to invest and buy cryptocurrencies, you can do it in sites like Bitso, Volabite or Binance, the latter also offers the possibility of buying goods through cryptocurrencies in peer-to-peer operations where each of the parties has a wallet to carry out the transaction while they ensure the safety of the process. On the other hand, if you want to monitor the value of the different currencies, you can do it from the investig.com, coinmarketcap.com and coingecko.com sites.
After the announcement of Tesla’s investment in Bitcoin, this currency rose in value by 10% and during the afternoon of February 8 it has a value of just over $ 46,000, but what gives value to cryptocurrencies? According to David Yao, director of operations in Mexico for Binance, “it has to do with how people use it, because at a technological level it is easy to create a cryptocurrency, but what is not easy is that people really trust a cryptocurrency, which is willing to pay its cost in the market and above all to use it ”.
If you want to invest in cryptocurrencies you must bear in mind that there is also a lot of speculation and just as a currency can suddenly increase its value, it can also lose it, although Elon Musk has given it a boost.
The most popular cryptocurrencies
There are many different cryptocurrencies, but among the most famous are Bitcoin, Tether, Polkadot, and Dogecoin (famous thanks to Musk). In the same way, you can consult other currencies that are also a good option to invest.