The idea of a virtual currency can be baffling to many of us. Cryptocurrencies seem to be a minefield of scams, volatility and speculation. There are also concerns about the environmental impact of cryptocurrency because of the volume of energy used to power computers involved in the system. Yet, there’s no doubt investing in cryptocurrency is growing in popularity. But before you consider investing in this new form of money, you need to become well informed.
Put simply, cryptocurrencies such as bitcoin are electronic assets that don’t exist in a physical form. They work separately from the traditional financial system.
While it is not actually money, payments for certain things can be made using these digital currencies. They use what’s called blockchain as a kind of digital technology that stores all transactions in an encrypted form. Blockchain is seen as faster, more direct and offers potentially cheaper transactions.
Financial adviser Marc Bineham thinks that despite the concerns, cryptocurrency does have a future.