What is Cryptocurrency?
A cryptocurrency is a kind of digital currency that uses blockchain technology. Cryptocurrencies are not subject to manipulation or inference by government bodies or other authorities. Cryptocurrency is essentially a digital asset distributed across a network of computers. The word refers to the advanced encryption techniques used to keep the network secure.
What are the advantages for businesses?
There are several benefits of investing in cryptocurrency for your business, so let’s take a look.
1. A Global Currency
Cryptocurrencies can be bought by anyone anywhere in the world; all you need is an internet connection. If your business works with consumers and clients overseas, cryptocurrency can be useful. These currencies provide zero or low transaction fees and tend to make good alternatives to countries that have weak fiat currencies.
2. New Markets
Cryptocurrencies allow businesses to trade in a new and niche market via creation of their own token. If your company deals in cryptocurrency, and your competitors do not, you’ll give yourself a competitive edge. Some companies have even created their own branded cryptocurrencies, widening their appeal and improving the identity of their brand.
3. Less Risk Of Fraud
Crypto is fully digital every step of the way, and it’s near impossible to counterfeit. Many believe that blockchain and cryptocurrency can help to prevent corruption and fraud. Having said this, there are still many issues with crypto overall in this department. There have been plenty of serious thefts and frauds in Bitcoin for example.
It’s important to keep in mind that if you are stepping into cryptocurrencies, you’re accepting the fact you’re practically gambling. As such, there is a level of strategy to be involved in this.
4. Inexpensive Fees
Cryptocurrencies have less expensive fees when compared with normal banking transactions. By using cryptocurrency, you can save money, plus experience faster transactions. Bare in mind that you’ll need a digital wallet to store your coins, and these services do include extra fees.
What are the different types of Cryptocurrency?
Bitcoin is one of the most popular types of cryptocurrency; another popular one is Ripple XRP and Ethereum.
Bitcoin is a virtual currency which you can use to pay for your services and goods. Ripple is a payment platform, and a cryptocurrency called Ripple XRP. Ethereum is currently the second largest in the market at this point is both a cryptocurrency and a platform that helps develop apps.
Bitcoin relies on the popular blockchain tech, whereas Ripple and Ethereum use a large network of validating servers and tokens. In a sense, Ripple and Ethereum are more useful since they can be used beyond mere money.
Take the Ripple network for example. Their tokens permits you to transfer between various currencies. So any currency you exchange will be in XRP (the token name) rather than USD. Due to this, payments are processed in seconds, and there are no exchange fees. Whether you invest in Ripple (xrp) or Bitcoin, you’ll benefit from zero transaction fees. Ripple XRP is platform specific, whereas Bitcoin can be used in a wide variety of places across the web.
A Word Of Caution
A word of advice for new entrepreneurs, while there are many advantages to investing in cryptocurrency it’s also important to weigh the risks before making any decisions. This technology is still pretty far ahead of its time. And what’s more appealing to businesses today is the Blockchain technology supporting these coins in the first place.
That doesn’t mean you shouldn’t consider making your own coin to benefit customers. If you think it’ll help, ensure that you conduct research about the best places to store your cryptocurrency and learn more about it. There are several methods of protection you can use to keep your money safe and many thoughts on cryptocurrency as a whole.