Previously, the forex and stock market were the only two financial markets that dominated digital trading. Investors have been investing millions of dollars in stocks, expecting high returns. Recently, the stock market had many setbacks in the last two years, and many investors failed to gain expected returns. Due to the COVID-19, the stock market was adversely affected, and so was the forex market, but what kept surging in such a period of crisis was the virtual currency market.
The virtual currency market is the new trendsetter in the world of digital trading. Cryptocurrencies are the product of blockchain technology, spread over different networks and record transaction in a public ledger which remains secure.
For a crypto trader, it would be highly beneficial to consider even minor aspects regarding virtual currency in order to stay updated. This article would help you with some interesting facts about digital cryptocurrency.
Exceptionally volatile nature
If you have been following the digital currency market, you would agree to the fact that the crypto market is highly volatile in its nature. There are three reasons behind it, first, the news cycle that encourages traders to enter the market, secondly, the embracement of virtual currency by the institutional investors has also contributed towards the high volatility. Last but not least, the emergence of financial instruments like futures contracts or options.
Bitcoin and altcoins
There are hundreds of other electronic currencies in the crypto market, that are available on different exchanges for trade, but among these bitcoin is the most prominent and dominant virtual currency in the term of market capitalization and market share.
Bitcoin was the first cryptocurrency that shook the world of digital assets, no other cryptocurrency has ever been more volatile than bitcoin, even the institutional investors are more interested in bitcoin as compared to altcoins.
Blockchain is the key player in the crypto world
Blockchain technology is behind the success of bitcoin and other digital currencies. The hype that virtual currencies have gained over the last couple of years would not have been possible if the blockchain does not exist.
Many investors and corporate companies are interested in blockchain technology. The cryptocurrency is just one product on the blockchain, there are multiple other ways through which blockchain could bring change in the world.
The specialty of blockchain is the way it records payments and transfer transaction in a decentralized public ledger in a secure way. Blockchain makes it difficult for criminals to attack and steal all the pieces of information. Instead, the information is spread all over the world in servers and hard drives. There is no central headquarter, where all data is stored.
Low barriers to entry
There is some sort of barriers or constraints that makes it difficult for everyone to jump into the market, for example, taxes or high-tech machinery. The case in cryptocurrency is different, anyone who has the investment and people who know how to do the coding can introduce digital tokens in the market.This is one of the reasons why the number of cryptocurrencies is increasing every month, right now more than 4000 cryptocurrencies in the market and many are on their way to launch. Among the currencies that are going to have an impact on the market is “e-yuan”. If you wanna know more about it search “Yuan Pay App” and get real insight.
Andrew is a writer that does most of his work on cryptocurrency-related topics. While he’s primarily interested in Bitcoin, he also follows major altcoins and the innovative ideas that new cryptocurrency and blockchain projects are bringing to the table.