Frequently Asked Questions

1. What are cryptocurrencies and how do they work?

A cryptocurrency is a digital currency intended to work as a medium of exchange that uses strong cryptography to secure financial transactions, control the creation of additional units, and verify the transfer of assets.

2. What are the most common cryptocurrencies?

There are many common cryptocurrencies however the most used ones are:

Bitcoin (BTC) - The first ever cryptocurrency that started it all.
Ethereum (ETH) - A Turing-complete programmable currency that lets developers build different distributed apps and technologies that wouldn’t work with Bitcoin.
Ripple (XRP) - Unlike most cryptocurrencies, it doesn’t use a Blockchain in order to reach a network-wide consensus for transactions. Instead, an iterative consensus process is implemented, which makes it faster than Bitcoin but also makes it vulnerable to hacker attacks.

3. What is crypto used for?

Other than potential increase in value here are other uses of cryptocurrencies:

Low-cost money transfers
Earn interest on Bitcoin and other cryptocurrencies with 'Yield Farming'
A censorship-resistant alternative store of wealth
Invest in innovative early-stage startups
Make private transactions
Send non-cash remittances
Travel the world & beyond

4. How many cryptocurrencies exists?

According to coinmarketcap.com the current listing for crypto is over 5000, this number is still growing and a new cryptocurrency can be created at any given time.

5. Why blockchains have the potential to be better than the current systems in place for transfer

There are many benefits that blockchain provides over traditional techniques of transferring money. It was developed to resolve three major problems including decentralisation, which means there isn't a single place where the transaction data is stored.

Second one being there is no middleman which means transaction fees are supposed to be much lower than they are at the moment.

The final one is that blockchain networks have the ability to be faster than tradition networks since verifications of the transaction isn't limited by working hours and bank holidays.

6. What is blockchain technology?

The way that cryptocurrencies work is by using a technology known as Blockchain. Blockchain acts as a digital ledger where all transactions involving virtual currency are stored. Buying, selling, using a Bitcoin, etc. are all encrypted and recorded through Blockchain technology.

6. How can you make money from cryptocurrency?

Buying and holding is the method you’re probably most familiar with when it comes to investing and making money with cryptocurrency: You purchase some sort of asset (like stocks), you let interest build up, and then you eventually cash out.

It’s the same idea in buying and holding with crypto, except you are waiting for the price of your chosen currency to go up so you can sell at a rate higher than when you bought.