As we can see from the data in the crypto news this December, there are many questions being asked about cryptocurrency in general, the main idea behind it and the process in which this technology work. Today, we are sticking to the four trending cryptocurrency questions which were asked by our readers this month – and answering them in detail.
1.What is cryptocurrency?
This is the first obvious question that is always popular.
Basically, cryptocurrency consists of web-based digital assets which use cryptographic functions to conduct financial transactions. This is how digital assets use blockchain technology to gain transparency and decentralization to different degrees. Digital assets include Bitcoin, other cryptocurrencies, stablecoins backed by fiat for lower fluctuations and tokens.
2.What are the different types of cryptocurrency?
This is another popular question and one of the four trending cryptocurrency and Bitcoin questions for this month.
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Bitcoin (BTC) is the most widely used cryptocurrency. There are also other cryptocurrencies known as “altcoins” which include Stellar, Tron, Salt and OmiseGo. Facebook is also joining the league and introducing the Libra coin which is different from other cryptocurrencies as it is governed by said partners and is tied to the fiat currency of government bonds and fiat currencies such as the US Dollar, Euro and Yen.
3.What is an ICO?
ICOs took the world by storm in 2018 and 2019 which is why they are raising so many questions. The four trending cryptocurrency questions also include the one about ICO or an initial coin offering (ICO) which is similar to an initial public offering (IPO) of stocks.
The only difference is that rather than stocks, ICOs offer tokens and the public exchanges money for tokens which are an acknowledgement that the contract between a buyer and issuer has been fulfilled.
4.What is the main idea behind the Libra coin?
The Libra news in 2019 showed that Facebook is unveiling the Libra stablecoin in 2020 – and its main idea is to create a coin with low volatility since its value is tied to fiat currency. Libra is said to be a rising coin that brings crypto into the mainstream – making everyone know about it. Coming from a popular player like Facebook, it is definitely an altcoin to watch out for.
Do you have more questions? Send them in the comments and expect answers soon!
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