Written by Julia Loten
There has been a LOT in the news lately about cryptocurrency; its rises and falls are taking the Internet by storm. These days, anyone can create a new type of crypto and market it as “the next Bitcoin” so that profit-cravers buy its stock and its value rises. This gives way to crypto forms called altcoins (less gracefully known as “sh*tcoins”) which are worth next to nothing. These types are formulated to yield short-term gains to initial investors by short-term price increases followed by nosedives of the stock after large investors sell.
But don’t be mistaken, these altcoins just exemplify the misuse of the cryptocurrency format. Crypto like Bitcoin and Ethereum are actually very helpful to people all around the world. So what exactly is this strange type of money? A cryptocurrency, named for the cryptography process that actually creates and processes the transactions of the digital “coins,” is a form of virtual money. Most cryptocurrencies are entirely digital, however some have become tangible by way of credit cards or real-world projects.
But regular dollars can be tracked digitally as well, so why use cryptocurrency? Well, cryptocurrencies are typically created to prevent government interference and control, which can help in many circumstances, many of which are perfectly legal. For example, one cryptocurrency called Ethereum aims to help those who don’t have access to traditional financial systems get loans, insurance, or other financial products regardless of who they are and where in the world they live. Ethereum is a particularly popular crypto, having a market capitalization of $287 billion and a price per Ether (its form of coin) of $2,460.44 as of June 2021.
Another reason people invest in cryptocurrencies is to avoid inflation of central banks; if anything, the price of a stable crypto like Ether or Bitcoin is increasing and the worth of your investment will go up.
So is crypto the currency of the future? Like all investments, putting money into cryptocurrency has risks. If the Bitcoin bubble were to burst after you’d bought even one token, you would be out 37 grand. But people seem to have trust in certain cryptocurrencies, and it seems unlikely that Bitcoin, Ether, or other reliable formats will lose their value. Certain altcoins are more clearly money-making schemes for their initial investors, but it gets hazy when speculating as to the future of the more popular coins; while they may have upward trends, all good things must come to an end. You just don’t want to be caught in the middle of it when the bubble bursts.
Because crypto is so unpredictable, I would stay away from investing your life savings in it. But it may be worth the risk if you believe in the future of digital financial platforms free from government control and surveillance. And not to mention, women truly need to get into the biz! Women in tech are a rare these days. But truly, this can be the currency, or tech for women. Crypto could really be the currency of the future, depending on how people use it. So my only piece of advice is the following: Do what you want with your investments, just do your research first!
Nerdwallet: What Is Cryptocurrency?
Investopedia: 10 Most Important Cryptocurrencies
CoinMarketCap: List of cryptocurrency types and prices
Cryptonaire News: Different Types of Cryptocurrency on the Market