Cryptocurrencies

Cryptocurrencies have seen unexpected popularity since they first came to light in 2009. There are now over two thousand in existence. The most popular ones include Bitcoin, Ethereum, Ripple and Litecoin. Not just popular, these cryptocurrencies are the most traded ones worldwide.

The technology that cryptocurrencies are using is called blockchain, which is a decentralized technology spread across many computers that manages and records transactions. It is world wide accepted that the most intriguing part of this technology is its security.

1. What are Cryptocurrencies?
2. What affects the Cryptocurrency market?
3. What are the top Cryptocurrencies traded worldwide?
4. Why trade Cryptocurrency with First Financial Banc?

1. What are Cryptocurrencies?

Cryptocurrency is a payment method that can be exchanged online for goods and services. There are several companies which have issued their currencies, they are also called tokens, and can be used for the goods or services that the company provides. You will have to exchange fiat currency for the cryptocurrency to access the goods or services. It is a digital asset based on a network that is spread across a large number of computers. As it is easily understood that this is a decentralized structure that allows them to exist away from governments and central authorities.

2. What affects the Cryptocurrency market?

► 1. Speculation
► 2. New Announcements
► 3. Regulation
► 4. New Cryptocurrencies

1. Speculation is a well-known influence on cryptocurrency prices. We all saw the collapse of Bitcoin’s price in 2018, mentioning the big shot of 2017 on a $20,000, going down to $1,000 in 2018. Both experienced and inexperienced traders can go long expecting the price to continue going up.

2. Cryptocurrencies have shown us a high sensitivity towards announcements. The kind of news that can cause changes in the price of Bitcoin starts from the CEO of JPMorgan Chase calling Bitcoin a ‘fraud’ to characteristics of the networks being hacked. There are of course economic and political events causing movements in fiat currencies can lead traders to lose faith in the traditional currencies and turn to cryptos, pushing up the price.

3. Since it is widely known that Cryptocurrencies are decentralized creations, there are lots of disagreements about the legitimacy of currency status, or even they should be illegal. China is one of the countries that put restrictions, like blocking websites that offer cryptocurrency trading services. This caused a 15% fall in Bitcoin and 20% plunge for Ether. During January 2018, Bitcoin’s price was hit by new South Korean legislation requiring Bitcoin traders to reveal their identity.

4. As more and more cryptocurrencies enter the market, the price of the current cryptocurrencies tend to go down (even slowly).

3. What are the top Cryptocurrencies traded worldwide?

► 1. Bitcoin is without doubt the most famous cryptocurrency nowadays. Designed by Satoshi Nakamoto, an anonymous person, in 2008. Bitcoin can be used as a medium of exchange. For example, companies in travel, gifts, jewellers sectors are accepting Bitcoin as payment through anonymous online transactions.

However, there are several companies that accept it as currency, others avoid it because of dramatic price swings. In January 2017, Bitcoin price rose sharply $1,151. In December 2017, its price went to the highest of all time $19,783. By February 2018 it dropped to below $7,000, in a matter of days it went up to $11,000, before going down to $4,000. Subsequently, one of the key characteristics of Bitcoin that traders should understand is its potential for extreme volatility.

► 2. Ripple is a cryptocurrency released in 2012, that runs on the blockchain network RippleNet. Its user base comprises more than 100 banks and payment providers which use the network for international procedures.

Ripple can be exchanged for any currency and serves as mediator between currencies that are relatively expensive to exchange directly via traditional methods. It can also be used for fast international transactions, with an average transaction time of four seconds.

However, there are several companies that accept it as currency, others avoid it because of dramatic price swings. In January 2017, Bitcoin price rose sharply $1,151. In December 2017, its price went to the highest of all time $19,783. By February 2018 it dropped to below $7,000, in a matter of days it went up to $11,000, before going down to $4,000. Subsequently, one of the key characteristics of Bitcoin that traders should understand is its potential for extreme volatility.

► 3. Ether is developed in 2012, by Vitalik Buterin, a Toronto- based programmer and backed by an initial $18 million crowdfund. While Bitcoin was designed to be a digital currency, Ethereum is a more general implementation of blockchain technology.

A well- known attribute of Ethereum network is that it gives users the chance to create independent apps, known as ‘dapps’ and smart contracts.

► 4. Litecoin was released in October 2011 by ex-Google employee Charlie Lee. Launched with the intention of being a cheaper version of Bitcoin for everyday purposes, Litecoin was formed in a ‘hard fork’ (split) of the Bitcoin Core client.

4. Why trade Cryptocurrency with First Financial Banc?

- 10 years of online trading expertise
- Small group of traders and dedicated account managers
- Trusted by +300,000 traders worldwide
- Multilingual Customer Support
- Market research with daily & weekly reports
- Global Liquidity & Instant Execution
- Segregated accounts with deposit protection