mining cryptocurrency

Bitcoin and other cryptocurrencies have been making the rounds across the internet for a while now. If you find yourself wondering, what exactly is crypto? Then join the club because not a lot of people fully understand what it means either. It’s supposedly like online banking but without any actual physical money involved and investing in it is supposed to bring in more cash than what you had spent on it.

Whatever the case, the crypto market appears to be thriving, especially in the time of the pandemic when people with the means to invest have nothing else to spend cash on, and the value of Bitcoin, in particular, has risen to lofty heights.

The promise of earning much more money than normal appears to be what entices most people to the thrall of cryptocurrency. Who can resist the temptation of making a quick buck after all, especially when crypto buying prices are as low as a single dollar?

The Technology

Cryptocurrency supposedly eliminates the middle man in online transactions by allowing you to send digital funds to another person directly using the cryptocurrency that you bought with real actual money. The difference between transacting with crypto instead of your usual online bank payments or other cash transfer apps is that crypto uses blockchain technology.

Instead of creating separate receipts or ledgers for every new transaction, every single transaction you’ve ever done is added onto that ledger which just goes on and on the more you deal with crypto. Moreover, crypto claims to be more secure, since its uses highly advanced code and encryption formulas to verify transactions when money is sent from one digital wallet to another.

Crypto Mining

Other than that, one can also earn crypto by “mining” for it, which requires an extremely advanced computer to solve equally difficult and advanced algorithms and problems. Remember those crypto transactions? When a transaction is finished, it creates “blocks” that contain hashing puzzles that are then added to the blockchain. Miners aim to be the first ones to solve those blocks and their puzzles and they earn cryptocurrency as a reward. Because the process can be hard and tedious, the value of crypto is greater, which is part of its appeal.

A Gamble

But is the simple promise of a skyrocketing value really worth the potential loss? Other than being potentially very valuable, crypto has the equal potential to be extremely volatile. Just as the value of a single crypto coin can go up, so too can it fall just as quickly. Not to mention the environmental impact of maintaining a crypto mining rig and the fact that you’re not actually transacting with or mining for actual money unless you paid for it.

But despite all the drawbacks, the potential of a steady and enormous increase in its value has given cryptocurrency not only infamy but some investors as well. Of note, there’s Elon Musk and his company Tesla which invested 1.5 billion dollars in Bitcoin. Online shops now accept Bitcoin and other cryptocurrencies as a legitimate mode of payment.

You can now hire a crypto marketing agency to help your brand expand and invest in a crypto venture. The cryptocurrency market doesn’t appear to be faltering one bit, even with many people decrying it. It seems that crypto’s volatile and inconclusive nature doesn’t deter anyone from investing in it for the potential of tremendous financial gain.

So is cryptocurrency really worth investing in?

At the expense of giving a cop-out answer, as with everything else, it depends.

It depends on whether you have the funds to be buying crypto or if you’d rather mine for it. Even if you go for the former, it would require a lot of money still to fund the right kind of technology to get your own mining rig going. And just like with the real-life stock market, there’s no guarantee of a steady incline or decline. Just like with real-life trading, it’s all a game of betting and waiting. The smartest people might be able to predict where the market will head and may come close to it, but there are no guarantees.

You might be able to gain more if you buy crypto at an especially low price but again, there aren’t any guarantees that you can get a deal as good as that. But on the flip side, if you can manage to get the timing right, investing in crypto could prove to be more profitable than ever. And maybe just the possibility of earning more profit than you set out with is enough to get people started. Maybe a crypto marketing agency could help with that. Who knows how the market really goes?

Whatever the case, keep in mind the potential losses you could incur and the drawbacks before you spend your money on something as volatile as cryptocurrency.

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