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Finance

What is Cryptocurrency?

Here we describe cryptocurrency to answer the question: what is cryptocurrency? Cryptocurrency is a form of “soft” or digital money; an example is bitcoin, where bitcoin is “mined” in a process called data mining using the combined power of multiple GPU cards, or video cards. Cryptocurrency is regulated more as it is a subset of virtual currency used as a medium of exchange, almost like that gold coin you see in video games. Unlike your credit card or the gold in video games, cryptocurrency is not backed by gold but is a currency all to itself.

Is it legal?

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Many myths and facts surround the legality of whether this type of soft currency is legal or not. But rest assured it is legal; however, the same rules that apply to hard money still apply to cryptocurrency so it is tracked the same as a dollar bill and you can face serious repercussions for misusing or doing any illegal activity with it.

How was cryptocurrency created?

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Cryptocurrency was first created by Nakamoto Satoshi as a sort of proof of work concept back in 2009. He wanted to prove a digital currency can be used in place of money to purchase digital and hard products or services such as property and or downloadable games and content.

How is it used?

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Today, cryptocurrency is used by all sorts of people. It is used by big companies and people in the private sector with enough wealth to afford the mining stations to make use of the currency on a day to day need as a sort of back up if their assets fail and they run into trouble. It is also used by private persons to keep their money out of regulated banks.

Why is it used?

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Many people have their own reasons why they use is; however, as a rule of thumb it is used as though it is physical money in that you buy items, stocks, and assets with it and trade it for services like you would a dollar bill for a candy bar at your local market chain. The only difference is that it is completely digital.

How does it affect hard (physical) money and the market?

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It doesn’t really impact the hard dollar much as many people don’t know how to use nor see a point in the use of cryptocurrency. Those who want to get into it are scared of the legality of it all still. And some places (most) will not accept cryptocurrency for goods or services; however, as it gains popularity many businesses are starting to get into the game of cryptocurrency.

Can you use it?

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Simply put, yes - anyone can use it. All you need is a computer and a bit of software. There are many different kinds of cryptocurrencies out there. It’s not an expensive thing to do; some people use it as a sort of pillow to fall back on as an investment for retirement.

Cryptocurrency may be something to look to as a big thing in the future as it is becoming more and more popular for investing, saving, large purchases, and more. If you are interested in learning more, it may be worth researching to see if it is something you want to invest your time, and money, into.

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