It’s getting interesting in the Cryptocurrency Revolution. Don’t believe us? Bitcoin appreciated 30 percent in a single week last summer, leaving at least a few analysts scratching their heads and pushing up price targets from $5,000 to $7,500. About the same time, a new cryptocurrency, FileCoin, collected over 200 million in an IPO that came to a premature halt when frantic investors crashed the servers with their demand. What pioneering currency trading software platform designer AionNext wants you to remember is that there is a lot of money to be made, but you need to be smart. There’s a lot of money to lose too.
There are plenty of definitions of cryptocurrency floating around, some of which are so convoluted they don’t provide any help to someone trying to wrap their mind around the idea for the first time. Sure, it helps to think of it as digital money, but how exactly does that differ from the traditional money supply? The first thing AionNext advises is to realize that, unlike any currency in history, a cryptocurrency like Bitcoin was not created and is not controlled by a single government, bank, or country. It truly is a ‘free agent’ that is beholden to no single institution or person.
But here’s another way to think about it. A cryptocurrency is essentially money that exists on a software platform that is powered by a database. For example, Windows is software that runs on a database installed on your local computer. Fedwire, software that allows financial institutions to wire one another money, works off a database installed on company servers somewhere. The critical thing to remember is that we’re talking about a single database in a single location (with some leeway for offsite backups, of course).
But as AionNext points out to traders interested in profiting from cryptocurrency, Bitcoin, and others like it, runs on a database considered impenetrable to hackers due to its decentralized nature. Rather than keeping a ledger in a single location, the Bitcoin blockchain is scattered to thousands, perhaps millions, of tiny nodes of individual users. These are the Bitcoin miners who power the whole process.
Is It Real Money?
The short answer is that cryptocurrency is real money. Trusted vendors like AionNext accept it just as easily as a dollar bill from good, ol’ Uncle Sam. Thousands of other legitimate vendors from around the world accept Bitcoin and its variants as well. This highlights the singular characteristic of whether a digital currency is viable or not – widespread trust. When people spend a currency, be it digital or otherwise, they are expressing their faith in it as a means of transferring and receiving value. Digital currencies absolutely pass this test, perhaps better than some traditional currencies in recent memory. We’re talking about you and your out-of-control hyperinflation Venezuela and Zimbabwe. Next to these two shining examples of fiat currency gone bad, cryptocurrency seems like a pillar of stability.
Cryptocurrency – A Profitable Market With the Right Tools
There are a few very real risks associated with trading cryptocurrencies, though platform innovators like AionNext are paving the way in creating a respectable and safe market. The reality is that technology will fail. New technology tends to fail at a faster rate and in a more spectacular fashion than established technology. With a ten-year track record in the currency trading trenches, AionNext offers traders a rock-solid foundation from which to navigate the sometimes treacherous waters of international trading of a relatively new asset.
Remember when Forex was all the rage? To be honest, it still is but, in the early days, scams propagated by fly-by-night vendors were all too common. The most important first decision a cryptocurrency trader can make in his or her selection of a reliable broker. Check the reviews, frequent the forums, and find out what the consensus on the street seems to be.
Got Technology Chops?
It should come as no surprise that you need to have some level of tech savvy in order to be successful in turning a profit with cryptocurrency. This doesn’t mean you have to be a teenage Bill Gates squirreling away in his parents basement inventing the most famous compute operating system in history, but you do need to either already have good skills or be willing to put in the work to acquire them. One of the best ways to do the latter is to find a broker like AionNext that offers free educational resources to get new traders up to speed.
The Bottom Line
There are resources out there for anyone interested in trading cryptocurrencies. The informal community that has grown up around the topic is a great place to start. Perhaps the best piece of advice is to not wing it alone. Don’t be afraid to stand on the shoulders of those who have been there before and clearly pointed out the way. There’s a lot of money to be made and potentially lost in cryptocurrency trading. Ignorance is your greatest foe and humility a good friend. Good luck!