Blockchain Technology – The Driving Force Behind Cryptocurrencies

Blockchain Technology – The Driving Force Behind Cryptocurrencies

 

You have always heard the terms cryptocurrency and blockchain together. However, they are two unique emerging technologies, but they are inherently interconnected with each other. Essentially, a blockchain is a digitized and decentralized ledger that stores the information in the block and creates a virtual database with the help of networks of nodes. When the transactions get verified, the information placed in the blocks is chained with another block present on the blockchain network. 

 

The Rise of Crypto – Powered by Blockchain Technology 

Blockchain is the key force behind the concept of cryptocurrencies. Digital crypto money works with the help of blockchain, thus, they have also considered decentralized systems. Known as virtual or digital currency, these emerging payment options are developed with cryptographic algorithms that boost security and are not controlled or owned by any single entity, making it quite hard for governments as well as financial regulators to manipulate.

Back in 2009, Bitcoin the first cryptocurrency was created, but now the list contains more than 10,000 crypto coins and tokens. However, blockchain technology was the pillar that laid the foundation of Bitcoin and helped to get the global attraction. Despite many controversies and a lot of misunderstandings regarding these concepts, both digital crypto money and blockchain have become an integral part of today’s financial-economic system and are all set to have a prominent presence in the future too.

Instead of being an optional technology for digital currencies, blockchain is a critical feature of it. Due to this reason, cryptocurrencies have become the catalyst for the blockchain’s development and growth, as digital crypto money depends on the blockchain network for existence. But on another hand, blockchain is also helping to develop crypto applications. However, it is not only restricted to the financial market, but is offering innovative solutions for other industries as well, and will continue to disrupt the digital markets in near future.

 

How to Trade Cryptocurrencies?

Like the stock market, many global investors are into coinlager money trading with digital currency because they hold high volatility, so if you can determine the right market trend and time Coinlager E-crypto trade can help you to make higher returns than fiat investments.

Often, digital crypto money traders have one or two key goals, make profits in USDT or accumulate cryptocurrencies. It is because, in the crypto trading market, it’s quite easy to boost USD value, but it’s hard to increase the value of bitcoin. In addition to this, by taking part in crypto trading, you can reduce the risk of losing your assets. Since cryptocurrencies are volatile in nature, it’s common to lose money in trading. 

​Step 1: Make a Cryptocurrency Exchange Account

If you don’t own digital crypto money, you will need to create an account on the cryptocurrency exchange. Coinlager, Coinbase, eToro, and Binance are among the best exchanges that are providing fiat to digital crypto trading services. To onboard on these platforms, you need to input personally identifiable information (PII) for example, name, date of birth, ID card number, and credit card number, similar to opening a bank account.

Step 2: Fund Your Account

Once the account has been created, you need to pair your bank account with the exchange. This will allow you to either top up the digital wallet provided by the digital coinlager online crypto exchange or directly buy cryptocurrency with a credit card or wire transfer.

 

Step 3: Pick Crypto to Invest in

Mostly, cryptocurrency trading is done through bitcoins and ethereum as these both are the most valuable as well as hold a large share of the crypto market. These coins work more predictably as compared to the new emerging Altcoins, so trading these currencies with technical indicators can be easier and more beneficial.

 

Step 4: Choose a Trading Strategy

There are heaps of cryptocurrency trading patterns and indicators from which you choose that suit you better. These strategies can help you to understand the market trends and various factors that you need to take into consideration when coinlager trading digital currencies with debit cards. Thus, a day and range cryptocurrency trading strategy that is worthwhile trying for beginners.

 

Step 5: Consider Automated Crypto Trading

When you are determined to start cryptocurrency trading, you might go for automated crypto trading that is actually powered by AI bots that automatically invest without requiring you to keep an eye over the market trends and strategies. These bots help to harness the best results to fulfill your investment goals.

 

Step 6: Store Your Cryptocurrency

If you are an active trader, you will need a coinlager digital wallet for cryptocurrency to store or hold your cryptocurrencies on the exchanges for instant access. However, there are various kinds of digital crypto money wallets, software and hardware wallets respectively. However, they have emerged with different features and security measures. 

 

Some of the Most Trending Cryptocurrencies for Investment

Dogecoin (DOGE)

Dogecoin is also well-known as “meme coin” and emerged in 2021. The coin has an image of Shiba Inu imprinted on them, which is accepted as a legal payment option by many businesses including Tesla, Kronos, SpaceX, and much more. The dogecoin was developed by Billy Markus and Jackson Pakner, in 2013.

 

Ethereum (ETH)

Do you know the difference b/w bitcoin and ethereum? Ethereum is the first alternative to Bitcoin. It’s a decentralized software platform that is used to create smart contracts as well as decentralized applications (dApps) that can be run without the interference of any third party. The aim behind the Ethereum emergence is to build a decentralized financial solution that anyone can use without any jurisdiction or nationality restrictions.

 

Bitcoin (BTC)

Bitcoin is the first cryptocurrency that was developed by using blockchain technology in order to provide an alternative payment gateway for fiat currencies. Instead of using the currencies created by central banks that require banks’ approval for making transactions, bitcoin allows you to make secure and anonymous transactions without third-party interference.

 

Do you know the history of bitcoin?

Digital Wallets – An Essential Component for E-trade Crypto

Digital crypto wallets allow traders to store public and private keys as well as provide a user-friendly interface to manage digital assets. In addition to this, it also permits the transfer of digital currencies through the blockchain along with assisting to perform trading actions like buying or selling with decentralized applications.

 

Not Sure What a Public or Private Key is? 

A key is a long string of characters that are randomly generated. Whereas public keys are like bank account numbers that can be shared with others, private keys are like ATM Pin Code that need to be kept in a secure place. Thus, in public-key cryptography, every public key is interconnected with one private key, combined together to encrypt and decrypt the customer’s transaction data.

 

Hot and Cold Wallets – What’s the Difference?

The key difference between both wallets is internet connectivity. Hot wallets require an internet connection, while cold wallets work seamlessly without requiring an internet connection. Thus, the digit assets stored in the hot wallets are more accessible than those placed in the cold wallets. However, being connected to the internet makes hot wallets more vulnerable to cyberattacks than cold wallets.

In a hot crypto wallet,  the stored private keys get automatically encrypted through the application. Using hot wallets is considered riskier than cold wallets; smart devices including computers or smartphones have hidden security loopholes that can be exploited by penetrators or phishing attacks that can take over the wallet. Thus, keeping the high-value assets in hot wallets is not considered a good practice, yet the vulnerabilities can be easily reduced with straightening encryption measures e.g 2FA.

 

Final Thoughts 

The rapid development of blockchain technology is becoming the key driving force behind the ultimate success of the crypto industry. As the governments are taking initiatives to make digital crypto money a legal trend, cryptocurrency exchanges and platforms are emerging that are assisting customers to become part of the cryptocurrency ecosystem.