2020 is being a bit hectic for the markets due to all the recent events that are happening, and many investors are looking for new investment alternatives. Therefore, now we bring you a new recommendation, investing in cryptocurrencies, which are assets that since their creation have noticed a great revaluation and, according to experts, will continue to have an upward trend. Therefore, we’re going to explain what a cryptocurrency is, how it works, how to invest, in which cryptocurrencies to invest and which are the best in 2020.
What are cryptocurrencies
The most widespread definition of virtual currency is that it is be sure you currency, not a physical one, that uses cryptography to secure and manage transactions, as well as to create new stock markets.
This explanation of what a cryptocurrency is includes the two most important characteristics of these electronic stock markets. You are that it does not have a physical support. That is, there are no bills or coins as there are euros, dollars or pounds. Cryptocurrencies are virtual and although they can be stored on physical devices, they don’t have a physical representation. What is the best cryptocurrency to invest in 2020
The second is that cryptography is used to create new units, which for practical purposes means it does not depend on any government or country. With virtual stock markets, there is no central body or government in control of creating new stock markets and putting more money in the market. As an example, Bitcoin uses blockchain technology to manage the creation of new units. Also, in this case, the number of coins available is bound, something that’s not always the case with other cryptocurrencies.
Types of cryptocurrencies
Sprint, Ethereum, Ripple, Litecoin … There are many virtual stock markets beyond the famous bitcoin. In fact, today the number of virtual stock markets far is higher than 1, 300 worldwide.
What differentiates the types of cryptocurrencies is the technology they use on the one hand and their philosophy on the other. To understand it better, most virtual stock markets use blockchain technology but with certain changes that can make them faster in processing transactions, for example. In addition, there are also stock markets that use different formulations. To this is added the philosophical part such as putting a limited number on the coins which will be in circulation or not, as well as the degree of openness in the transactions.
Although when investing it is necessary to have sufficient financial knowledge and to know exactly what are the products in which we are lodging our money and what risks we are assuming. At smartcapitalonline. com we tell you which are the best cryptocurrencies to invest and what you should take into account to choose them. However, remember that if you do not have the necessary training it is best to go to a financial expert before playing everything one card.
What cryptocurrency to buy?
Winning coins with cryptocurrencies is possible, but you should know which one to bet on and how to do it. In this sense, there are various ways to buy cryptocurrencies from trading with cryptocurrencies to mining virtual stock markets. Choosing the asset well and the form of exploitation is key, particularly when they are so volatile and have so much risk.
Most profitable cryptocurrencies
As the currency markets saying goes, past returns do not ensure future returns. The development of a virtual currency is a good indication of its potential, but it does not mean that it is the best cryptocurrency to buy 2020. The price of virtual stock markets, with falls greater than 50% since the beginning of the year is a good example. Is this an indication that you have to flee the sector in a hurry? Very little less, just that the price was too filled with air.