A beginner’s guide to cryptocurrency – CryptoMode


We’re going to make a quick guess: you’ve heard of cryptocurrency and want to know more, but like most people, you’re frustrated with how hard it is to get started. We feel your pain. Cryptocurrency can be a daunting subject, especially if you are only coming from another exchange where everything is measured in fiat money.

Why are you here? We bet you might know just enough to be dangerous, but not enough about cryptocurrency mining (the backbone of all cryptocurrency) and trading (buying and selling your coins), without talk about how it all fits together. It’s OK; We have what you need.

We’re going to break it down for everyone to understand. But first…

What is cryptocurrency?

If you haven’t heard of cryptocurrency yet, let us catch up with you really quickly before we start with the meat and potatoes. Cryptocurrency is a decentralized peer-to-peer digital currency that uses cryptography (encryption) to secure transactions and in most cases to control the creation of new units. Cryptocurrencies are not printed like fiat money; they are produced by people running specialized computer programs, and their supply is limited.

Why does cryptocurrency exist?

Some people think this is the future of money. Others think it could be one of the best real-life examples of the sharing economy. The answer is, well … it doesn’t matter why you care about cryptocurrency right now, what matters is that you understand how it works before you start.

Even though there are over 1000 cryptocurrencies, Bitcoin remains the most popular coin to date.

The reason behind this has everything to do with the biggest innovation of the first cryptocurrency: decentralization. Before Bitcoin, it was difficult to communicate about cryptocurrencies because they were all different; you had to buy and trade different currencies through different exchanges.

If you wanted to access all of these tools and networks, you had to pay a fee for each exchange using traditional payment methods like credit cards or bank transfers.

As we will see in a future article, decentralization and anonymity (the two often go together) are at the heart of most cryptocurrencies: they are intended to eliminate intermediaries like banks and governments from our transactions, thus making them safe for everyone. . You can use platforms like The era of bitcoin to exchange crypto coins.

How does cryptocurrency mining work?

Bitcoin is still by far the most popular cryptocurrency on the market, but new coins are getting harder and harder to mine. If you’re new to mining – or have thought about getting involved with Bitcoin or another of the bigger cryptocurrencies, like Litecoin or Ethereum – you might want to do some research before you jump head first. .

Do not worry; we’ll keep it simple. Mining is the process by which cryptocurrency transactions are validated and new units of that currency are added to the general ledger.

You need to understand something about cryptocurrencies in general: They are not controlled by banks or governments, and this has huge advantages over fiat money. When the time comes to verify a transaction, a network of miners is tasked with verifying that all the rules have been followed before adding the transaction to the general ledger.

The first cryptocurrency, Bitcoin, had this system built in; its security is based on strong encryption and consensus among users. By using these two elements together, Bitcoin has been able to create an honest currency that is free from tampering by banks or governments.

In conclusion, there is so much about cryptocurrency that you need to learn. As such, you will need to be very patient and do your homework properly. As a beginner there is a good chance you will make some beginner mistakes, but you will improve over time and with our help.

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