What are cryptocurrencies & how to invest in them

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What are cryptocurrencies? 

The first cryptocurrency called Bitcoin was created on January 3rd, 2009 by an anonymous person called Satoshi Nakamoto.

After its invention, several other cryptocurrencies like Ethereum were created. What makes cryptocurrencies special is that they are virtual currencies that can not be tracked. They are not issued by governments like the American Dollar or Euro. Crypto also can’t be regulated or controlled by governments. 

Fun fact: Cryptocurrencies are actually payment systems a lot of illegal organizations use to spend and receive money. Most of the dark web uses Bitcoin or other cryptocurrencies for buying and selling.

What is blockchain? 

A system called “Blockchain” stores the cryptocurrencies in a virtual database. The database usually has basic information like who owns what, what is transferred, and other details. 

How to invest in cryptocurrencies: 

Get yourself a cryptocurrency wallet from a platform like Exodus that is safe. Then create an account on cryptocurrency exchange websites like Coinbase and start buying your preferred type of crypto! 

Most websites accept credit and debit cards, sometimes even Paypal.  When you buy cryptocurrencies, they will get transferred into your cryptocurrency wallet. 

How do crypto wallets work? 

Most people store their cryptocurrencies on virtual wallets like Exodus. Although there are other methods like Hardware wallets, Desktop wallets, and a few more. 

Unlike other currencies where banks or governments control your wallet, no one central authority controls the crypto wallet. The wallet is simply an address on the Blockchain that the owner can access with a password (also known as a private key). 

Public & Private Keys: 

The private key is kind of like the password you use to access your wallet. A public key on the other hand is what you use to receive payments from others. If someone else knows your private key, they might be able to pretend as the owner of your wallet. 

The lesson is from: The Quantified Fortune by Arian Adeli 

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