Tag: cryptocurrency

Your Ultimate Guide to Cryptocurrency Wallets

Introduction to Cryptocurrency wallet

Introduction to Crypto Wallets

A crypto wallet serves the same purpose as a physical wallet because it stores your valuable assets. You can put your cash in your wallet or your cards if you are the type who is very savvy, or both if you don’t like surprises. The same is true with a cryptocurrency wallet—you store your tokens in them so as to keep them easily accessible on the go. 

In the early days of cryptocurrency, sending tokens was a very tedious process. One would need to deliver long keys to whoever one wished to send them to. The case is different today, as recent wallets have made the Blockchain much more accessible and user-friendly. 

What is a Crypto Wallet 

A cryptocurrency wallet is any device, software, or material that holds and protects your private keys and allows you to access your coins.

A cryptocurrency wallet stores your cryptocurrency assets. However, it has a twist in that instead of storing your tokens directly, it keeps the private keys you use to authenticate your crypto transactions and provides an interface for transacting with your coins. 

This is because your cryptocurrency is always on the blockchain but is not accessible without a private key that validates that it belongs to you. It is also important to note that keeping your private keys is necessary because anyone with them can make fraudulent transactions using your address.

It is impossible to access your tokens without a private key and software that allows you to access the Blockchain. 

Categories of cryptocurrency wallets

There are two main categories of wallets: custodial wallets and non-custodial wallets.

  1. Custodial Wallet: Custodial wallets are wallets in which the owner does not bear the responsibility of protecting the private keys themselves. A third-party organization keeps the users’ private keys and protects them at all costs. 
  2. Non-custodial Wallet: These wallets require the user to take responsibility for securing their private keys. Hardware wallets, which typically fall into this category, are a typical example. 

These wallets can be further divided into two subcategories: Hot and Cold wallets. A Hot wallet connects to the Internet or is linked to a device with an Internet connection, while a Cold wallet does not. 

NOTABLE CRYPTOCURRENCIES: Revolutionary Impact, Pros and Cons. 

REVOLUTIONARY IMPACT OF NOTABLE CRYPTOCURRENCIES

Introduction 

According to CoinMarketCap, there are at least 2.4 million crypto-currencies and 735 exchanges, and the cryptocurrency market has an estimated market valuation of $2.4 trillion. This data changes almost constantly, but one thing is constant: the valuation of most notable cryptocurrencies has only grown higher and higher since its inception, and it does not plan to take a downward turn. 

Notable cryptocurrencies range from Bitcoin to Litecoin, Tether, SOL, and Ethereum; amidst an enormous number of cryptocurrencies available, one could find it challenging to decide whether to leap into the crypto world. A list of notable cryptocurrencies might be a great place to start because of the security they offer and their popularity. However, a fundamental knowledge of the working principle behind these notable cryptocurrencies will be able to give you an idea of what to expect and also look out for when divining into the world of the unknown in cryptocurrency. Let us take a look at a few of them. 

Notable Cryptocurrencies, working system and revolutionary Impact

  1. Bitcoin (BTC)

Bitcoin (BTC) is a revolutionary cryptocurrency with a market value of over $1.3 trillion. Satoshi Nakamoto, an unknown creator, introduced it in 2009, and since then, Bitcoin has grown in fame, use and worldwide acceptance.

In its inception, Bitcoin had no recorded cost price because no one was willing to place a premium on it. However, the first-ever sale of Bitcoin was on October 12, 2009, when a Finnish developer, Martti Malmi, who worked on the project, sold 5050 BTC for $5.02, making a single unit worth $0.0009. 

In May 2016, a single Bitcoin sold for around $500. As of the first quarter of 2024, one bitcoin is worth between $65,000 and $70,000, depending on the volume of the trade in the day. 

Introduction to Cryptocurrency, FIAT money, and stablecoins

Meaning of the word “currency” 

As you are introduced to the world of cryptocurrencies (FIAT, stablecoins, etc.), it is important to understand the fundamentals of money and how currency works around the world. 

Start your Crypto Journey today leanr about FIAT money and Stablecoins

Money and currency are not the same thing, at least in theory.  Money is not always something you can touch, but currency (FIAT money) is a real thing that can be used to buy things. People think of money as numbers, while coins and bills are called currency. A physical object is presented at the point of transaction. This difference will interest only some people, so it will not be the focus of this blog post. However, for the sake of this blog post, we will consider money and currency to be the same term.

Money is a recognised medium of exchange made with the intention of creating a platform for people to buy or sell their products and services easily. In former centuries, the system used to exchange values was the barter system. A crop farmer may need a tuber of yam; this means he will take a portion of his crop products in exchange for yam from someone who needs the crop products and is willing to give out a tuber of yam. 

The batter system failed to achieve an effective means of exchange because it couldn’t effectively unify the desires of the exchangers. Most exchangers will not find the person who desires their product or service and is willing to provide their exact desire for exchange. This inconsistency led to the invention of currencies, which have evolved over several decades until now. 

What is FIAT money?

What is FIAT money

Photo Credit – 8photo by Freepik

The term ‘FIAT Money’ sounds very technical; however, there is no need to panic; it just refers to a form of currency the government issues. Every day we buy, sell, or do both with FIAT money, like the USD, Pounds, Euros, and many others. The drawback of FIAT currency is that with it, the central bank has so much power and control over the economy; this is due to the fact that they can control the extent to which FIAT money can be produced. This is what makes FIAT currency different from cryptocurrency.

What is cryptocurrency?

Cryptocurrency, unlike the FIAT money that the central bank issues, is a digital currency. These currencies, as opposed to the common currency (FIAT Money), are not tangible, and the government does not have direct control over them. It’s operation is Internet-based and is not reliant on the authority of the central bank or government agency to regulate it. 

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