These days, there are a lot of merchants, both online and offline, accept cryptocurrency (Bitcoin) as a form of payment. Bitcoins can be used to pay for hotels, flights, restaurants, jewellery, apps, computer parts and even college fees. Other digital currencies like Litecoin, Ripple, Ethereum and so on are not widely accepted yet. However, users of cryptocurrencies other than Bitcoin can always exchange their coins for Bitcoins.
Cryptocurrencies are one of the hottest investment opportunities currently available, as many people believe that. Bitcoin is the dominant digital currency to date, while Ethereum, perhaps the second most valued cryptocurrency, has recorded the fastest rise a digital currency ever demonstrated. However, it is noteworthy to mention that cryptocurrencies are high-risk investments. Their market value fluctuates, there is always a risk of them getting outlawed in certain jurisdictions and any cryptocurrency exchange can potentially get hacked.
Tip: As with any other investment, you need to pay attention to the cryptocurrencies’ market value and to any news related to them. Coinmarketcap is a one-stop solution for tracking the price, volume, circulation supply and the market cap of most existing cryptocurrencies.
Much more like trading, mining is an investment. Essentially, cryptocurrency mining, or cryptomining, is a process in which transactions for various forms of cryptocurrency are verified and added to the blockchain digital ledger. Each time a cryptocurrency transaction is made, a cryptocurrency miner is responsible for ensuring the authenticity of information and updating the blockchain with the transaction. The mining process itself involves competing with other cryptominers to solve complicated mathematical problems with cryptographic hash functions that are associated with a block containing the transaction data. The difficulty of the puzzles is constantly increasing, correlating with the number of people trying to solve it. The more popular a certain cryptocurrency becomes, the more people try to mine it, the more difficult the process becomes. Once a miner manages to solve the puzzle, they receive a reward as well as a transaction fee. That’s how miners make profits.