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Questions That Consumers Want To Know About CryptoCurrencies Like BitCoin

BitCoin
Image Source: Coin Desk

Below are some valid questions that consumers would want to know about cryptocurrencies like bitcoin. This is a start, maybe we should do a series of videos to gradually increase the knowledge of consumers.

What is a cryptocurrency? A cryptocurrency is a digital asset designed to work as a medium of exchange that uses cryptography to secure its transactions, to control the creation of additional units, and to verify the transfer of assets. Wikipedia

What is bit coin? bitcoin is just a cryptographically secure medium of exchanging value. Bit coin can be moved around, used to buy goods and services and it has scarcity. Only 21 million bitcoin will ever be mined. And over 16 million have already been mined.

Why is bit coin so popular? The favourite topics around the world have always been about property prices and airline travel. No we see bitcoin and cryptocurrencies becoming part of the conversation.

Why are more people suspicious of bitcoin? 

So although bitcoin is increasingly cropping up in conversation, very few of these people own any bitcoin.The cryptocurrency could absolutely be in for a short-term price bubble. But over the long term, the upside is far from over.That’s likely because buying bitcoin is still relatively cumbersome. Exchanges need to do know-your-customer (KYC) checks. Depending on where you live, funding a bitcoin account can require a trip to the bank and an expensive bank transfer. And you still need to familiarize yourself with a new asset class, which takes some effort.

What is the difference between traditional currencies and cryptocurrencies? As an asset class,it would be fair to categorize bitcoin as similar to U.S. dollars, sterling, yen or any other currency. It is a form of currency. And as such, it should be looked at as something between say, dollars and gold.

What is the technology behind bit coin? At the core of bitcoin technology is a kind of super distributed ledger called the “blockchain.” The blockchain is public and accessible to anyone, just like the internet.

How safe is it to invest in? It is viable that everyone should get some cryptocurrencies in their portfolio.The most appropriate course of action for the majority of investors is simply to buy a little bitcoin – and forget about it. Don’t overreach and buy more than you can afford to lose, and certainly don’t borrow to buy bitcoin. Just buy, hold and ignore the volatility.

What are the expected returns if I invest? if it falls or even goes to zero, your loss is small (assuming you’ve put in only what you can afford to lose). But if over the next few years it continues go up, then gains of 10 to 20 times are entirely possible… and even bigger gains lie outside of bitcoin in the cryptocurrency space. There is no other asset class on earth that offers this kind of return profile.

What is the future of cryptocurrencies? Everyone needs to familiarize themselves with the process of buying, trading and storing cryptocurrencies. They’re here to stay. And being on the outside (and not understanding them) will limit your ability to profit from them.

Who regulates bit coin? The other important thing to remember about bitcoin is that it’s not actually controlled by any central organization – the Federal Reserve, the Treasury, the Bank of England or the European Central Bank.There’s no company, there is no CEO, there is no chief financial officer.I think there’s every reason to believe that the importance of cryptocurrencies will grow over time simply because it is something that is not controlled by governments.