Originally written with Publish0x in mind for my Writing Workshop "What Will You Write About" assignment.

What Is A Cryptocurrency?

To begin, you need to understand what it is we’re talking about before we delve deeper into this topic.

Cryptocurrencies are decentralized digital currencies. By crypto being decentralized, this means that no bank, no government, and no single entity or entities can control a cryptocurrency. This doesn’t mean that the developers of a cryptocurrency can’t make changes but there is only so much they can control after the release of the project. No one can directly control the price of crypto. I will be touching back on how pricing works in crypto later on.

 I just mentioned the word/phrase, “Project”. What does this mean? Think of the term “Project” in cryptocurrency as the equivalent of a Silicon Valley start-up.

Cryptocurrencies use what is known as a “block-chain”. Think of the block-chain as a digital version of a bank audit log that is available for the public to see. The block-chain is more or less the brain of the crypto world. The block-chain is what allows exchanges to be made. I’m not the most qualified person to be talking about the block-chain but there are some good articles and videos are explaining it. 

  Cryptocurrencies price[s] are determined based on a supply & demand basis, as are most things. The major difference between crypto’s prices and other things prices is the fact that crypto’s prices are also determined by something called “pool liquidity”. The way pool liquidity works is it’s a pool of tokens locked away into what is called a “smart contract”. “They are used to facilitate trading by providing liquidity and are extensively used by some of the decentralized exchanges…” - medium.com. This is just the short of it but there are more informational resources out there for this topic. 

Is It A Scam?

Is it a scam? That is one of the most asked questions about crypto exchanges. Well for starters, like everything, there are scams out there. The way scams in crypto work are very different from other scams. The way they work is that they get a large number of people to “invest” in a new project to boost liquidity. Once the prices go up, the people behind the scam who hold a lot of the token, sell everything they have which is known as a “dump”. When they dump, they make lots of money and drive the price into the ground causing the “investors” to lose their money. 

With a lot of cryptocurrencies, the creators don’t do this because they want to create something of their own. Crypto can be risky and investing in smaller crypto’s can be very risky but have a high reward. Investing in more established crypto’s is low risk and can usually have a low to moderate pay off. 

There is the misconception that crypto cannot be exchanged and converted into fiat currencies (U.S.D, Euros, etc). But that is not true. There is a very well trusted website called coinbase.com where you can take the crypto you hold and convert it into a fiat currency of your choosing. There is another website called bitrefill.com where you can convert crypto into a gift card of your choice. I can vouch that bitrefills.com is legit because I have used it to convert $250 into an Amazon gift card and $50 of my earnings into an iTunes gift card. 

With coinbase.com and other websites, you can have the balance equivalent to your or less than your wallet transferred into your bank account and removed from your crypto wallet. If you are mining crypto and are using a service known as nicehash, they provide a service so that you can store the crypto you mine in a wallet that’s built into the website. They also provide a service where you can submit for a “digital credit card” where they give you credit card info that's completely digitized. You can then submit for a physical one that will run you about $12. They then send you a physical credit card that you can use in stores that draw from your wallets balances. 

Cryptocurrencies can be a scam, but that doesn’t mean that all of them are and that all they are used for is deception and illegality. In my option crypto will eventually become mainstream and more widely used as people realize its versatility and use.