Blog 12: Cryptocurrency

Cryptocurrency is a rather new concept which was broadly introduced by the crypto bubble in 2018. Of course cryptocurrency has been around for several years before 2018.

Many people don’t know what cryptocurrency is and that’s ok because it can be quite complex and of course no one has taught you what it is.

Cryptocurrency is a virtual currency that is decentralised, which means it isn’t controlled by anyone. Currency as you and I know it is centralised as it is controlled by central banks.

Cryptocurrency uses blockchain technology to become decentralised. It uses encryption to identify and verify transactions between 2 people.

There are pros and cons to this, and for some people it’s the reason they love cryptocurrency and for some people it’s the reason they hate cryptocurrency.

Because crypto is decentralised it means it can’t be traced, so it means cryptos can be used to buy naughty things off of the dark web, such as drugs and weapons. Some people like this feature and some people don’t.

There is a massive investment opportunity in crypto because in the future it is fairly likely that crypto could replace normal everyday cash (known as fiat money). This is especially true in the UK considering that 70% of the UK is cashless.

Many governments around the world have opposed the idea of crypto because they can’t control the money supply which makes it incredibly hard to control the economy.

After the bubble in 2018, there is still opportunity to invest in crypto although I wouldn’t recommend it because of how risky it is, and I don’t mind risk when I invest but I don’t like investing in crypto. However if you’re happy with that risk then you can invest and you never know it could lead to a second bubble. As crypto is very speculative.


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