Blockchain and Cryptocurrencies have been the online buzzword in the world of finance for a couple of years now. Ever since BITCOIN surged to historic highs, other coins and tokens have entered the fray with ICOs happening left and right. But what exactly is Blockchain, and what are Cryptocurrencies?
Blockchain as expertly explained by Ann Cuisia, CEO of Traxion.Tech is a technology platform which acts as a decentralized database. A public ledger where transactions using cryptocurrencies are chronologically and publicly recorded. The data though public, is highly encrypted making it impossible to hack since the information on each block is recorded not just on one computer, but on many other computers as well.
Here’s a short video on blockchain that I found on Youtube by IBM Think Academy.
Cryptocurrencies on the other hand are stores of value. A digital asset that is fungible and tradable. An example of this is Bitcon, Ethereum, Ripple and the other coins that have emerged recently.
So what are the benefits of Blockchain, and how is this going to change the way we do things in the future?
Blockchain allows for a more transparent and smoother transaction between two or more entities. For example, when used in government transactions such as when accepting financial donations from a humanitarian organization, blockchain allows for 100% transparency of each transaction thereby greatly reducing, if not eliminating corruption altogether. The cost of transacting using blockchain is also significantly smaller, and faster thereby freeing up lots of time and capital allowing the organization or business to have more assets allocated elsewhere.
What about Cryptocurrency? How does it help people?
A lot of Filipinos in the Philippines are unbanked. This is because they live in areas that are underdeveloped and have no banks nearby. Since cryptocurrencies can be accessed online, people in far flung areas, will now be able to have access to financial services and even send or receive money at lower transaction costs.
These are just one of the many ways blockchain technology and cryptocurrencies can help change the way we do things. Whether we like it or not, new technologies like cryptocurrency and blockchain will change the future of money. It will change how money moves from one hand to another.
I must admit that prior to attending the seminar I had my reservations about his new technology however, after listening to Ann Cuisia’s presentation I am now more optimistic and open to embrace the endless possibilities and benefits that this technology offers, apart from the possible future financial gains that I can make should I decide to add it to my investment portfolio.
Just like any other asset class and investment instrument, cryptocurrencies carry with it a certain level of risk. Not all cryptocurrencies are the same. Make sure to do your due diligence first. Some cryptocurrencies are actually scams and not legit. So what does one have to look for to make sure it’s not a crypto scam? Here’s a brief list that you can refer to.
- Unrealistic Claims. Make sure you read the white paper thoroughly and carefully. Understand everything about it line by line. If the cryptocurrency you’re looking at has elements of Multi-Level Marketing, RUN! Cryptocurrency should never and must never mix with MLM. If it does, it’s a ponzi scheme. If it offers you guaranteed returns, and profits that are too good to be true…it probably is…RUN AWAY!
- No Code Base. A majority of cryptocurrencies are open sourced and have a codebase, and you should be able to access their codes in GitHub. If it doesn’t have any codebase, then you have good reason to think it could be a scam.
- No White paper and Ghost Team Members. Any legitimate cryptocurrency should have a white paper that details the specific project, and other pertinent details. There should also be REAL people behind it. The last thing you want to do is to buy coins or tokens from a company with a team that lacks the credentials or experience to deliver.
More info here: https://masterthecrypto.com/identifying-scam-coins/
While cryptocurrencies have not yet gained global acceptance as a mode of payment, there is no denying that it is going to be the future. The time will eventually come when all the regulations concerning its use will be in place, and it will become the new way to transfer wealth from one person to the other.