openPR Logo
Press release

Crypto for non-cryptonians

The breathless press releases, the excitement, the hype, the highs of the bull markets, the lows of bear markets, the tweets and the regulators’ concerns; the crypto sector has provided plenty of debate over the last few years. Unless you are directly involved in it, asking a question can feel like a multitude of superhero comic fans are giving you a half an hour, panel-by-panel account of what happened in issue #312 and how it explains the decisions made in issue #647, when all you actually asked was whether the chap in the red cape was a goodie or a baddie.

In an effort to help non-experts understand the crypto sector a little better, here is a very quick, non-technical explanation of some of the terms you may find yourself coming up against.

Crypto
Crypto is basically shorthand for cryptocurrency, a catch-all term that has come to cover the entire sector. We are two lines in it is already about to become complicated, but broadly speaking, the sector started to develop around the first cryptocurrency (Bitcoin, see below) and as people started to appreciate the different ways that the underlying technology could be used, it started to be applied to different assets. In the process, the currency part of cryptocurrency started to be dropped and the sector came to be known simply as crypto.

It is known as crypto because the way that crypto assets work is based around extensive decentralised databases known as ledgers. To access these ledgers, you need a complex mathematical key to decrypt the information. These are known as cryptographic keys, and this leads us neatly to crypto.

Fiat
Fiat is traditional, non-crypto money that is not backed by a commodity such as gold. Its coins do not have an intrinsic value, they are simply backed by government policy and regulation. Fiat currencies have dominated the global economic system since the 1970s.

Crypto enthusiasts suggest that fiat’s value is dubious because governments can simply print more money if it suits a particular policy or economic climate.

Bitcoin
Bitcoin was the first of the modern cryptocurrencies to wink into existence. Its heritage can be traced back several decades, but basically Bitcoin coalesced into existence in January 2009 when a mysterious person or group of people going by the name of Satoshi Nakamoto released it as open-source software onto an unsuspecting world.

The benefits of Bitcoin are that it can be traded directly globally without an intermediary, meaning that the financial costs of trading are significantly lower than moving money though a traditional bank network. It has several issues however: its anonymity has led to suggestions that it can be used to launder money, the lack of regulation means that it could be open to abuse, and the way that it works though a specific form of crypto mining means that it has a significant environmental footprint.

Crypto coins
Looking beyond Bitcoin there are a range of other crypto coins. Some of these, such as Ethereum and Dodge Coin, have been discussed widely for different reasons, but there are also hundreds of others out there with markets that enjoy varying levels of liquidity.

As is the nature of things, the technology behind some of these coins has moved on from what is used to manage Bitcoin. These enhancements reduce the environmental impact that crypto is thought to have, although Bitcoin still represents nearly half of the total cryptocurrency traded.

Tokens
While some crypto coins are intended to be simple digital stores of value in and of themselves, some are being used by small, innovative companies who are trying to raise funding. These coins, which tend to be known as tokens, rise and fall according to the fortunes of the projects that they support, and offer several benefits to both investors and the companies that issue them.

For a start, they are significantly simpler to manage than a traditional initial public offering (IPO). Token sales can be set up, companies can apply to have them traded on an exchange and investors can support a project without the significant costs of an intermediary or extensive back-office. Holding periods and other token management functions can be virtually automated and because they are so cheap, tokens can be offered to a potentially far wider pool of liquidity than traditional shares, creating a far larger potential market.

The problem, because there always is one, is that because the issuing of tokens has been basically unregulated, there have been several projects that have been created purely to take advantage of investors. There needs to be a balance between the freedom to operate and raise funds and enough regulation to remove the projects that do not offer acceptable levels of investor support and protection.

Stable Coins
Stable coins could be described as a hybrid of crypt and fiat, and aim to be the best of both worlds. Stable coins have all the benefits of crypto in terms of speed of transaction and low cost of trade, but they are pegged to a traditional currency.
They are unlikely to suffer the kinds of volatility that have been a feature of many crypto currencies over the last decade because their performance is directly linked to the traditional foreign exchange market.

I hope two things have become clear during the first part of linked set of articles. Firstly, crypto is a massively complex sector but it is possible to explain it relatively simply without going too far into the technicalities. Secondly crypto is not a panacea, for every problem it solves, new issues are often created. After the challenges of 2020, there is a massive opportunity for the financial markets to evolve and enhance the way that investors are supported over the next few years. The best way that we can support its development is through understanding.
In another article, I’ll try and shed light on several more crypto terms including DeFi and crypto mining.

QATO CONSULTING LIMITED
Collingham House 6-12 Gladstone Road
SW19 1QT London

About Marco Quacken
Marco has a passion for business development that helps projects succeed and businesses flourish. With a global network of contacts, he brings teams together, matching expertise to requirements and implementing strategies that help good ideas grow into sustainable businesses. He has experience across a range of sectors including finance, real estate, technology, advertisement, automotive, consumer goods, energy, retail, sports and telecommunications.

This release was published on openPR.

Permanent link to this press release:

Copy
Please set a link in the press area of your homepage to this press release on openPR. openPR disclaims liability for any content contained in this release.

You can edit or delete your press release Crypto for non-cryptonians here

News-ID: 2324017 • Views: 559

More Releases from Qato Consulting Limited - Marco Quacken

NFTs: But is it art?
One of the topics that has kept popping up throughout the last year has been non-fungible tokens (NFTs), these funny little bits of cryptology that, in the eyes of the evangelical, have the potential to replace money, change the nature of commerce, and revolutionise the very functioning of the financial markets. Many other people are scratching their heads wondering if they really as good as all that and even if
Is this the dawning of the age of the metaverse?
Most of the time, people not involved with a specific sector can ignore the buzz words that seem to inevitably spring up around an interesting idea. The trick is to wait for them to reach the point where it looks like they might get to a critical mass and become important to a wider audience. The metaverse is one such word, something that’s just starting to become visible in the
Will CBDCs bring balance to crypto?
Crypto’s independence is the answer to several of humanity’s challenges, but its freedom also attracts scams that earning criminals billions each year. Is there a way for society to enjoy the benefits the emerging digital currencies while reducing the risk of fraudulent behaviour? Some say that central bank digital currencies hold the answer, but there is a risk that they don’t solve the issues, simply change the nature of the
Will you accept crypto becomes when will you accept crypto?
Crypto has achieved many things in its short life. It has been lauded as the next big thing while simultaneously being pilloried as an accident waiting to happen (or being an accident in the middle of happening). Regulators have spoken out against it at the same time as small investors have flocked to it. Pages and pages of content have been written explaining why this time, crypto is going to

All 5 Releases


More Releases for Bitcoin

BITCOIN UP REVIEW 2022:IS BITCOIN UP A SAFE INVESTMENT?
Bitcoin Up Review:Despite the fact that it is a complex world, the introduction of trading robots made it easier for newcomers to understand the world of cryptocurrencies. They can open the doors for passionate investors wanting to reap the rewards of these technologies capable of forecasting price movements and making judgments without any human assistance by democratizing the use of these sorts of assets with automated algorithms and artificial intelligence. Cryptocurrency
What is Bitcoin? Understanding Bitcoin & Blockchain in 10 Minutes.
Bitcoin's open-source code (software), launched in 2009 by an anonymous developer, or group of developers, that are known only by the pseudonym Satoshi Nakamoto. This ingenious codebase enabled a completely trust-less network between strangers. And both sender and receiver can remain anonymous, if they so desire. Bitcoin is not printed by a government or issued by a central bank or authority. Bitcoin is created by ingenious open-source code (software) installed on
Bitcoin Information Service Market May Set New Growth Story | Bitcoin Magazine, …
The Latest Released COVID-19 Outbreak- Bitcoin Information Service market study has evaluated the future growth potential of COVID-19 Outbreak-Global Bitcoin Information Service market and provides information and useful stats on market structure and size. The report is intended to provide market intelligence and strategic insights to help decision makers take sound investment decisions and identify potential gaps and growth opportunities. Additionally, the report also identifies and analyses changing dynamics, emerging
Bitcoin Association launches online education platform Bitcoin SV Academy
Bitcoin Association, the Switzerland-based global industry organisation that works to advance business with the Bitcoin SV blockchain, today announces the official launch of Bitcoin SV Academy – a dedicated online education platform for Bitcoin, offering academia-quality, university-style courses and learning materials. Developed by Bitcoin Association, Bitcoin SV Academy has been created to make learning about Bitcoin – the way creator Satoshi Nakamoto designed it - accessible, accurate and understandable. Courses are
Bitcoin & co., what are they ultimately for? Invest in Bitcoin halving expectati …
Eduardo Strecht Ricou, Libertex Senior Analyst I am often asked if I have a favourable or unfavourable opinion regarding the world of cryptocurrencies. I answer them with a question: "Do you know what Bitcoin is for?" They sometimes answer that they're "not sure" what Bitcoin is for, but that they heard the neighbour screaming out the window that he had made money buying and selling Bitcoin. What is Bitcoin? A new revolution in
Bitcoin going down, purchases for Bitcoin - grows
Coin2Shop analysts have published data about the number of buyers who use BTC and ETH to pay for goods in online shops has increased. And if in August the number of users of the company's plug-in did not exceed 400 accounts, and the number of purchases for cryptocurrency was almost half less - 231 transactions from August 10 to September 10, then for the same dates from October to November