Cryptocurrencies are now well known, at least in name, even by those who do not invest professionally: everyone knows that investing in cryptocurrencies can generate very high profits.
Oftentimes, however, one does not have a clear idea of what cryptocurrencies really are and how they are used. In the course of this article, we will clarify both the meaning of the term and the profitable use that can be made of it. We will also talk about the best platforms to invest in cryptocurrencies such as eToro. We mention eToro among the many platforms available to invest in cryptocurrencies because it is the easiest to use for beginners and even allows you to automatically copy what the best traders do.
Cryptocurrencies: What are they?
A cryptocurrency is a digital asset used to exchange through encryption to secure transactions and have control over the creation of a new currency. It is a digital asset that is encrypted and used for exchanges. The best-known and pioneering cryptocurrency is Bitcoin.
The vast majority of cryptocurrencies are also decentralized: this means that the cryptocurrency works according to the rules, which are coded in advance, but there is no central authority that guarantees the correct functioning of these transactions: it uses the same algorithm that guarantees security and reliability of transactions.
For the sake of completeness, remember that there are cryptocurrencies that are not completely centralized, such as Ripple.
In this article, however, we do not deal with the technical aspect of cryptocurrencies but with how to use them to obtain the highest possible profits without risk.
Cryptocurrency: the Bitcoin
To understand in a practical way what cryptocurrencies are, it is sufficient to analyze the Bitcoin, the first non-centralized cryptocurrency conceived in 2009 by Satoshi Nakamoto. Since then, hundreds of altcoins have been created and these are alternatives to Bitcoin. Over time, the primary cryptocurrency has remained the Bitcoin, which has reached a quotation of 1000 euros for a single unit.
The Bitcoin is an instrument of exchange, a currency like the pound or the euro. This cryptocurrency was designed to exchange digital information through a process initiated with the principles of cryptography and is used to protect transactions and to control the creation of new coins.
The Bitcoin system is not comparable to the banking system. Banking institutions respond to a central system such as the ECB in Europe or the Fed in the USA. With cryptocurrencies, there is no control over “printed” amounts. However, there is a Bitcoin limit of 21 million. It is therefore not possible to alter the value of Bitcoins.
Financial institutions can print more money by increasing inflation as a result of the unstoppable expansion of the money supply by central banks.
Most cryptocurrencies are derived from one of the protocols: proof-of-quota or proof-of-work. Each cryptocurrency is substantiated through a community of cryptocurrency miners. This network of people structured their computers or ASIC machines to take part in validating and processing thousands of transactions every second that perform the cryptocurrency and in particular the Bitcoin.
This cryptocurrency is safe from bugs in the hash set. The only chance of violating the system would be derived from a 51% attack. There should be a miner capable of extracting more than 51% of the network, in order to take control of the global blockchain and create its own alternative. The hacker could hypothetically reverse his transactions or block other operations.
Law enforcement is almost impossible to seize a cryptocurrency. No intermediaries should be used to execute transactions. Different speech from Paypal where virtual currency needs intermediaries. Every cryptocurrency is pseudo-anonymous. Some coins have created functions to generate anonymity.
How it works and what OneCoin is
OneLife or OneCoin presents itself as a virtual currency, one of hundreds that have emulated the Bitcoin. OneCoin’s proposal would be so interesting that it would generate considerable wealth. Recently, OneCoin would have changed its name to OneLife (apparently also due to judicial vicissitudes). Those who want to access the OneCoin system must take part in meetings in which the opportunity to become rich in a very short period of time is expected. The motto is: “The sooner you join, the sooner you make money”. The system is very dubious. When registering you have to buy a Starter Package, as in many pyramid schemes. You spend from a minimum of 100 euros up to 28 thousand euros. The purchase of this package does not give you the right to own OneCoin or any other cryptocurrency. You can only buy tokens to exchange or mint to buy OneCoins. This Kari Wahlroos fables about an untrue market capitalization.
Bitcoin has a market capital of EUR 5.7 billion. The founder of OneCoin claims to have a market capitalisation of EUR 3 billion. Not only does OneCoin not excel in economic and financial portals by capitalization, but it does not exist at all.
We strongly advise against OneCoin or OneLife. Rather, those who want to invest online can rely on authoritative, authorized and regulated and therefore reliable brokers.
Cryptocurrencies: how to invest
Everyone knows that cryptocurrencies are one of the investment assets with the highest potential returns. Unfortunately, however, not everyone knows how to really invest in emerging cryptocurrencies to achieve these high returns.
Best Cryptocurrency Platforms
The first element to consider is the platform used to invest in cryptocurrency. It is necessary to use a secure and reliable platform and unfortunately not all of them are suitable. The fact that with Bitcoin you can earn a lot of money has prompted many scammers to use Bitcoin to organize scams of all kinds (because of the large number of scams there are people who think that Bitcoin is a scam).
How do you invest in cryptocurrency without the risk of fraud? Simple, just choose authorized and regulated platforms. These are platforms that allow you to trade on traditional assets such as stocks that have recently made it possible to invest in Bitcoin and other cryptocurrencies.
The level of security and reliability offered by these platforms is equal to what you could get from a bank.
We have made a list of the best platforms to invest in cryptocurrencies. We have selected only the most reliable and secure platforms but this is not enough: we have also chosen platforms that are simple and intuitive to use, even for a beginner.
Here is the list of the best platforms:
eToro is one of the best platforms ever to invest in error-free cryptocurrency. Not only is it a truly simple and intuitive platform (even for those who don’t even know what cryptocurrencies are) but it is also the only platform that offers the possibility to operate fully automatically.
How? eToro guarantees the possibility to select other investors and copy them automatically. In practice, beginners usually choose to copy the best investors (Popular Investor), i.e. those who have made the highest profits in the past with the lowest risk.
The results are good from several points of view: you can immediately invest successfully and learn by watching what the best investors do.You can register for free on eToro by clicking here.
Do cryptocurrency always go up?
Cryptocurrencies have increased dramatically throughout 2017. After a break, they continued to rise in price in 2019, ensuring high profits for all investors.
But beware: no financial asset can rise indefinitely, not even cryptocurrencies. Is this a problem for investors? Absolutely not.
It is important to know, in fact, that those who invest with the best platforms have two fundamental operations at their disposal:
- Buying a cryptocurrency to make a profit when the price rises
- Selling a cryptocurrency short to make a profit when the price falls. Short selling is a purely speculative operation that generates a profit when the value of a security decreases.
The smartest investors, those who work with the best platforms, therefore have the opportunity to always make a profit, no matter what the market does. All they have to do is make a correct forecast. In other words, if you want to make a profit with Bitcoin you just have to make good forecasts about the price.
Cryptocurrencies are among the best financial securities for those who want to make speculative investments: many of those who speculate on the Stock Exchange have also started to earn with cryptocurrencies.
Those who decide to invest in cryptocurrencies must carefully select the platform to use but usually, they favor those that are safe and reliable. It is also very important to keep in mind that profits can be made in any market condition, not only when the prices of the selected cryptocurrency is rising.