“Crypto for dummies”: The how, what and why of using virtual currency
If you haven’t heard of cryptocurrency, you haven’t been paying attention to the news recently. If you’re not sure what cryptocurrency is or what you should do with it, correspondent David Pogue is here to tell you (almost) all you need to know in a few simple steps:
- Bitcoin was the first cryptocurrency.
The term “cryptocurrency” is abbreviated as “crypto.” Bitcoin was the first, and it is currently the most widely used. However, there are over 10,000 different cryptocurrencies to choose from. One can be started by anyone!
- They are entirely electronic currency.
If you search for “bitcoin” on Google Images, you’ll see tens of thousands of images of real metal coins. Don’t be deceived! You can only see cryptocurrency on your phone or computer screen. The internet is the sole cash register.
- Cryptocurrency is difficult to spend.
Another reason why bitcoin may not strike you as a typical currency is because of this. For the time being, you’ll have a hard time spending it!
- The chain does not include banks or governments.
A blockchain is a trustworthy mechanism to track all of those transactions in cryptocurrency. It’s a public internet database that’s theoretically impenetrable to tampering.
- Currently, cryptocurrency is largely used by investors.
“I think it’s arguably the biggest bubble of our history,” Ryan Payne, head of wealth management firm Payne Capital Management, said. “I mean, it’s possible that this will be useless at some time. It’s very likely.”
- You buy and sell cryptocurrency on websites known as “exchanges.”
At Coinbase.com, the largest U.S. exchange, a customer provides their email address, receives a verification email, is asked for their phone number, receives an authentication code by text, and pays $50 for 50 bitcoins.