Cryptocurrencies are becoming extremely popular as of late. They seem to be on the cusp of replacing fiat money and ushering in a whole new era of digital payments. It’s safe to say that the boundaries crypto aims to push are pretty ambitious.
There are different types of coins and each one serves a different purpose. In addition to that, each coin is backed by a blockchain that has different features. Some blockchains work incredibly fast and allow thousands of TPS (transactions per second) while others aim to achieve other goals.
All in all, cryptocurrencies are fun, innovative and the future of payments. So, let’s take a look at the different types of cryptocurrencies and what kind of features they bring to the table.
Bitcoin is arguably the most popular cryptocurrency in the world. There’s not a soul that hasn’t heard of it. It’s the first decentralized currency and it has made millions of individuals rich. In November 2021 Bitcoin hit an all-time high with a price of $69,000 per coin.
This coin always tops every list of cryptocurrencies as its growth potential is unparalleled. As things stand, Bitcoin is dropping which might indicate that it’s the right time to get your hands on some coins, setting yourself up for profits when the bull run happens.
Ethereum is one of those blockchains that has gone through a major change. Shifting away from Proof-of-Work, the now Proof-of-Stake blockchains offer security like no other cryptocurrency. It can also be viewed as a development sandbox since developers can easily create decentralized applications.
It’s also one of the most famous smart contract blockchains making it the perfect fit for businesses. The current ETH price hovers around $1,100 and experts predict that by 2030, the price of ETH can climb up to $7,000. That being said, carefully analyze the charts before you make an investment. Cryptocurrencies are extremely volatile and no one knows when they will go up or down in value.
For those that want to avoid risks while in the crypto market, stablecoins are there to cater to their needs. Some might argue that the main selling point of cryptocurrency is its decentralization.
With Tether coin and other stablecoins, the value of the currency is pegged 1:1 with the US dollar. So, given that this coin is centralized, investors can expect stable prices and no fluctuations. But since there are no fluctuations in price how can investors expect to earn profits? Well, the answer is fairly simple. Crypto exchanges offer Tether holders to lend money and earn profits via interest rates.
Another stablecoin, the USD Coin (USDC) was initially created to become the digital dollar. It’s also pegged with the dollar and it’s the perfect coin for risk-averse traders. And rather as an investment, this coin is envisioned to be just a digital replacement of the dollar and to be used for everyday online purchases.
Where to buy cryptocurrency?
Now that we know there are different coins and different types of coins whether decentralized or centralized, you might be wondering where you can get your hands on these coins. Even though the coins are different and they serve different purposes, they can be found on all major crypto exchanges. On crypto exchanges, you can also find valuable articles which will help you develop your trading strategy and achieve more profits with each trade.
Going on, you should also look into trading with futures to boost your profit opportunities. However, don’t forget that you will need a wallet to store your currency. You can either go with cold or hot wallets. Cold wallets are wallets that operate offline and they are much more secure.
On the other hand, a hot wallet is basically software that allows you to manage and store your cryptocurrencies. Before you purchase crypto, see whether there are officially issued wallets by the development team.
Cryptocurrencies are a great way to make a profit if you know the ins and outs of the market. There are of course different types of cryptocurrencies and some of them offer more features than others.
The coins we mentioned above are some of the most popular and Bitcoin and Ethereum have serious capabilities to make investors rich. While Tether and USD Coin are designed to offer investors stability and the option to make online purchases safely.