It is difficult to find a person in the modern world who did not hear about cryptocurrencies, since last couple of years not only specialized publications “for geeks” have been talking about them, but also the largest media in the world. But, much of these experts’ reasoning is frank nonsense, which creates additional difficulties for newcomers. We want to help you understand the intricacies of the cryptocurrency world.
An important clarification: in this article we will not go into technical details and spell out how cryptocurrencies work. We will talk about less obvious, but no less important things.
Where does cryptocurrency cost come from?
At the heart of any cryptocurrency is blockchain technology. In a very simplified way, the blockchain can be understood as a database that is simultaneously stored on many computers around the world, and each file in it is associated with the previous ones. As a result, it is impossible to hack it and replace any information. Also, the blockchain in cryptocurrencies tracks every transaction that occurs with any coin in the network – where it came from, to whom and when it was transferred. And all this information will be stored forever.
So there, are no fake bitcoins or ethers (well, except for plastic circles sold in the passageways), no one can suddenly “print” a lot of coins, collapsing their value, if desired you can track the moving of each coin throughout its “life cycle” .
So, yes, largely the value of the crypt is determined by trust in it (in general, similar to fiat money). Only cryptocurrency, in contrast to, for example, the US Federal Reserve, has not only a name, but also a real technology that supports this trust. Of course, attempts are being made to justify the cost of some coins through the costs borne by miners, but finally it all comes down to the fact that the cost of any money, including digital, is determined by users.
The situation with specific project tokens is more complicated. Here a lot can depend on what exactly the token is used for. In some cases – it can be “just another coin”, not different from others. Some tokens are used to pay for the company’s services at better prices (a popular option is to pay commissions on exchanges). And sometimes tokens are the actual equivalent of shares and allow the holder to receive dividends. As a result, the cost of tokens depends also on the demand for them, and on the market situation, and on how successful the project is.
In a word, cryptocurrencies, no matter how hard they are presented as “indulgence for geeks”, are the same assets as shares, fiat money or, perhaps, gold. And they are acting similarly.
Great, but how can I make money on it?
The number of ways to make money on a crypt is close to infinite. Someone mines, someone just buys a currency and hopes that it will rise in a price, someone launches their own ICO of different degree of success. But the most promising (especially in the absence of significant start-up capital) is trading on the exchange.
Finally, the cryptocurrency market has no fundamental differences from the stock or foreign exchange market. Just enter it and start trading, getting real, not symbolic profit, is much easier.
Yes, in this market, everything is the same as in the more traditional ones – mistakes can lead to collapse and trying to trade “for luck” is frankly stupid. And many experienced crypto traders, who often come from the foreign exchange or stock market, successfully use this, earning fortunes from the mistakes of newcomers.
Fortunately, this situation does not suit all market participants, and some trading platforms began to work not only on attracting “new blood”, but also began to help newcomers to get settled.
A good example is the Bistox Exchange, which offers two technologies at once that can greatly facilitate the start of trading on the exchange.
First of all, the artificial intelligence system D.A.N.N.I. is built into the trading platform, which task is to help the trader. Not to “trade in its place”, but, namely, to help to make the right decisions and, that it is equally important, to warn against mistakes. It is clear that even the use of AI cannot guarantee success, but D.A.N.N.I., at least, will save you from making a mistake. And mistakes are made by every trader, especially at the beginning of his career.
Secondly, the function of “social trading” is implemented on Bistox. Beginners will be able to copy deals made by the most successful traders (adjusted for volumes, of course). For this, the “top” trader will receive a part of the exchange commission, and the “padawan” will be able not only to learn to trade, but also to earn something.
Combined with the interface, automatically (thanks to D.A.N.N.I.) adapting to the needs of each individual user, these features make Bistox almost the best platform to start your acquaintance with the world of cryptocurrencies.