Crypto

Crypto currency is the term given for a myriad of assets that have exploded int the world in recent years. Bitcoin, Litecoin, Ethereum and Ripple are just four of thousands of Crypto “coins” that are now stored and traded.
Investments That Stand The Test Of Time

Why Invest In Crypto?

Bitcoin was the original and the most well-known Crypto Coin and is the largest by market cap. Bitcoins are “mined” by miners- programmers training computer power to work out complicated mathematical puzzles which when completed are rewarded as a transaction in a Bitcoin ledger. These transactions from different miners are all linked as a chain and bundled into blocks (giving rise to the term “block chain technology) A completed chain is created every 10 minutes and each completion is known as a coin.

Nothing physical exists as a coin is only a string of data recorded in a digital ledger which is extremely difficult to unlock making this technology very secure. The coin owner stores that coin in on a hard drive or a digital wallet. Ownership transactions are also recorded in the same distribution ledger. Each time a coin changes hands the ledger is updated becoming part of that coin’s unique DNA. It is extremely difficult and ultimately very expensive to run the powerful computers and programs required to solve the puzzles and create these block chains. It is estimated that each coin costs approximately $200 in electricity usage alone to mine giving rise to the initial value of the crypto assets.

The Case For Bitcoin

In the case of Bitcoin, the number of coins that can be mined is limited to 21 million, and to date, more than 19 million have been mined, with new coins being produced globally at a rate of approximately 900 per day. The limited number of coins available creates a well-defined market, with demand for coins putting pressure on their prices. Good news increases buying interest and drives prices higher.

Coins are therefore considered a store of value but can be used as currency since they are easily exchanged. More and more businesses are allowing Bitcoin as a form of payment, and El Salvador voted in June 2021 to make Bitcoin legal tender. Given the global political war and inflationary environment, many believe Bitcoin is a better store of value and currency in these countries, despite its high volatility.

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