STATE OF THE CRYPTOCURRENCY MARKET
Since the introduction of blockchain technology, there has been a high demand for cryptoassets in the markets. With the rise in bitcoin prices attracting worldwide attention, it is highly likely that interest and acceptance from the general market will continue to grow even more. The cryptocurrency market continues to boom despite the global pandemic that is wreaking havoc on all significant global economies. Cryptocurrencies, especially Bitcoin, are currently seen as safe haven assets from market volatility and inflation. More importantly, the confidence of the corporate giants in cryptocurrencies has added more value to them as a currency and store of value. In October 2020, international digital payments company PayPal launched cryptocurrency buying and selling functions on its platform and allowed transactions using cryptocurrencies.
The dawn of a new investment era began with the incredibly successful Ethereum ICO in July 2014. Those who invested just $ 1,000 in ETH in August 2015 watched their modest investment grow to over $ 1.25 million in March 2021. Investors should be rewarded for holding onto coins for an extended period of time. However, there are several obstacles to cryptocurrency adoption on a broader scale. While it is not as difficult for non-tech users to enter the crypto markets as it once was, there are still no references or reputable partners to rely on. The cryptocurrency market is evolving as a new sector of finance and is creating an environment of higher volatility.
CONCEPT OF CRYPTOCURRENCY
Cryptocurrencies use cryptographic protocols or complex coding systems that encrypt the transmission of sensitive data to protect their units of exchange. Cryptocurrency developers build these protocols on principles of advanced mathematics and computer engineering that make them nearly impossible to crack, duplicate or counterfeit. These protocols also mask the identity of cryptocurrency users, making it difficult to assign transactions and flows of funds to specific individuals or groups.
Cryptocurrencies are characterized by decentralized control. The supply and value of cryptocurrencies is controlled by the activities of their users and the complex protocols embedded in their regulatory codes, and not by conscious decisions of central banks or other regulatory bodies, in particular, the activities of miners - users of cryptocurrencies who use enormous computing power to record transactions when receiving newly created units of cryptocurrency and transaction fees paid by other users in return are critical to the stability and smooth operation of currencies.
Cryptocurrencies can be exchanged for fiat currencies or other cryptocurrencies in special online markets called crypto exchanges. Each cryptocurrency has a variable exchange rate with major world currencies (such as the US dollar, British pound, euro and Japanese yen, as well as major cryptocurrencies like Bitcoin, Ether, and others). This also applies to AUR since its inception. Most cryptocurrencies have a limited supply. Their source codes contain instructions on the exact number of units that can and will ever exist.
This differs significantly from fiat currencies, in which central banks can decide to create money at will. Thanks to their political independence and near-impenetrable data security, cryptocurrency users enjoy advantages that are not available to users of traditional fiat currencies such as the US dollar and the euro, and the financial systems that support these currencies. For example, while the government can easily freeze or even seize a bank account located in its jurisdiction, it is very difficult for the government to do the same with funds held in cryptocurrency, even if the owner is a citizen or legal resident. On the other hand, cryptocurrencies come with many risks and disadvantages, such as illiquidity and value volatility, that do not affect many fiat currencies. In addition, cryptocurrencies are often used to facilitate transactions in the gray and black markets, which is why many countries treat them with distrust or outright hostility. And while cryptocurrencies are touted by proponents as a potentially lucrative alternative investment, some financial professionals consider them only suitable for pure speculation.
CRYPTOCURRENCY AND BLOCKCHAIN
The blockchain of a cryptocurrency is a general ledger that records and stores all previous transactions and actions that confirm ownership of all units of a currency at any given point in time. As a record of the entire history of cryptocurrency transactions to date, the blockchain has a finite length containing a finite number of transactions that increase over time. Identical copies of the blockchain are stored at every node in the cryptocurrency software network - networks of decentralized server farms run by computer-savvy people or groups of people known as miners who constantly log and authenticate cryptocurrency transactions. Technically, a cryptocurrency transaction does not complete until after it is added to the blockchain, which usually happens within a few minutes. Once a transaction is completed, it usually becomes irreversible. Unlike traditional payment systems such as PayPal and credit cards, most cryptocurrencies do not have built-in refund functions (some newer cryptocurrencies have such functions). During the delay between the start and end of a transaction, units are not available for use by either party. In this way, the blockchain prevents double spending or manipulation of the cryptocurrency code by allowing the same currency units to be duplicated and sent to multiple recipients.
Each cryptocurrency holder has a private key that proves their identity and allows them to exchange units. Users can create their own private keys, which are formatted as integers between 1 and 78 digits long, or use a random number generator to generate them. Once they have the key, they can receive and spend cryptocurrency. Without a key, the owner cannot spend or convert their cryptocurrency, making their assets unavailable until the key is recovered. This is an essential security feature that reduces the likelihood of theft and unauthorized use. Losing your private key means losing access. You can create another private key and start accumulating cryptocurrency again, but you will not be able to recover the assets protected by your old, lost key.
BITCOIN AND BOOM CRYPTOCURRENCY
Bitcoin is widely regarded as the first modern cryptocurrency - the first publicly used medium of exchange, combining decentralized control, user anonymity, blockchain-based record keeping, and embedded scarcity. This was first outlined in a 2008 white paper published by Satoshi Nakamoto, a person or group under a pseudonym. In early 2009, Nakamoto released Bitcoin to the general public and a group of enthusiastic supporters began exchanging and mining the currency. By the end of 2010, the first of dozens of similar ones will appear, cryptocurrencies began to appear. Around the same time, the first public bitcoin exchanges appeared, and at the end of 2012, WordPress became the first major merchant to accept bitcoin payments. Others, including Newegg.com (an online electronics store), Expedia, and Microsoft followed suit. Dozens of sellers, including Tesla, view the world's popular cryptocurrency as a legal payment method. While few other cryptocurrencies are widely accepted for trade payments, increasingly active exchanges are allowing them to be exchanged for bitcoins or fiat currencies, thus providing critical liquidity and flexibility.
ADVANTAGES OF CRYPTOCURRENCY
BUILT-IN DEFICIENCY CAN SUPPORT VALUE : Most cryptocurrencies are programmed for scarcity - the source code determines how many units can ever exist. Thus, cryptocurrencies are more like precious metals than fiat currencies. Like precious metals, they can provide inflation protection not available to users of fiat currencies.
SELFISH, SELF-GOVERNING COMMUNITIES : Cryptomining is a built-in quality control and control mechanism for cryptocurrencies. Since they are paid for their efforts, cryptominers have a financial interest in maintaining accurate, up-to-date transaction records, thereby ensuring the integrity of the system and the value of the currency.
RELIABLE PRIVACY PROTECTION : Privacy and anonymity were major concerns for early cryptocurrency proponents and remain so today. Many cryptocurrency users use pseudonyms that are not associated with any information, accounts or stored data that could identify them. While it is possible for sophisticated community members, new cryptocurrencies have additional protections for identifying users, which make the task much more difficult.
FINANCIAL RETURN IS DIFFICULT FOR GOVERNMENTS : When citizens in repressive countries come into conflict with their governments, said governments can easily freeze or seize their internal bank accounts or reverse transactions in local currency. This is not possible with cryptocurrencies, whose decentralized nature - funds and transaction records are stored in many places around the world and effectively prevent state capture.
NO THIRD PARTY HANDLING FEES : The concepts of lock keys, private keys and wallets effectively address the double spending problem by ensuring that new cryptocurrencies are not used by tech-savvy criminals capable of duplicating digital funds. Cryptocurrency security features also eliminate the need for a third-party payment processor like Visa or PayPal to authenticate and verify every electronic financial transaction. In turn, this removes the need for mandatory transaction fees to support these payment processor operations, as miners, the cryptocurrency equivalent of payment processors, earn new units of currency for their work in addition to additional transaction fees.
LOWER COSTS FOR INTERNATIONAL TRANSACTIONS : Cryptocurrencies do not refer to international transactions any differently than to domestic transactions. Transactions are either free or come with a nominal transaction fee, regardless of where the sender and receiver are. This is a huge advantage over international fiat currency transactions, which almost always have some special fees that do not apply to domestic transactions, such as international credit card or ATM fees. And direct international money transfers can be very expensive, with fees sometimes exceeding 10% or 15% of the amount transferred.
Millions of people use cryptocurrency wallets, but there is significant misunderstanding about how they work. Unlike traditional "pocket" wallets, digital wallets do not store currency. In fact, currencies are not stored in any one place and do not exist anywhere in any physical form. All that exists is transaction records stored on the blockchain. Cryptocurrency wallets are programs that store your public and private keys and interact with various blockchains so that users can track their balances, send money, and conduct other transactions. When a person sends you bitcoins or any other digital currency, they are essentially signing the ownership of the tokens to your wallet address. To be able to spend these tokens and unlock funds, the private key stored in your wallet must match the public address to which the currency is assigned. If the public and private keys match, the balance in your digital wallet will increase, and the sender's will decrease accordingly. There is no real exchange of real coins. A transaction is simply indicated by a record of the transaction in the blockchain and a change in the balance in your cryptocurrency wallet.
Cryptocurrency users have “wallets” with unique information that confirms that they are their owners. While private keys verify the authenticity of a cryptocurrency transaction, wallets reduce the risk of theft for devices that aren't in use. Wallets can be stored in the cloud, on an internal hard drive, or on an external storage device. Regardless of how the wallet is stored, it is highly recommended that you create at least one backup. A cryptocurrency wallet is software that stores private and public keys and interacts with various blockchains, allowing users to send and receive digital currency and control their balance. If you want to use Bitcoin or any other cryptocurrency, you will need to have a digital wallet. The Gold Digital platform provides a convenient way for buyers of AUR tokens and registering them in a wallet. This allows buyers / token holders to access the internet section of our website and track saved purchases. The owner of the token has the ability to store tokens in the AUR wallet or transfer tokens to the wallet chosen by the buyers. Polyus LLC provides an easy way to validate tokens purchased using a smartphone and an app available on the IOS and Google Play stores.
TYPES OF WALLETS
There are several types of wallets that provide different ways to store and access digital currency. Wallets can be divided into three distinct categories - software, hardware, and paper.
SOFTWARE WALLETS can be desktop, mobile, or online.
- DESKTOP wallets are downloaded and installed on a PC or laptop. They are only accessible from one computer on which they are downloaded. Desktop wallets provide one of the highest levels of security, however, if your computer is compromised or infected with a virus, there is a chance that you could lose all of your funds.
- MOBILE wallets run in an app on your phone and are useful because they can be used anywhere, including retail stores. Mobile wallets are usually much smaller and simpler than desktop wallets due to the limited space available on a mobile device.
- ONLINE wallets work in the cloud and are accessible from any computer device anywhere. While accessing them is more convenient, online wallets store your private keys online and are controlled by a third party, which makes them more vulnerable to hacker attacks and theft.
HARDWARE differ from software wallets in that they store the user's private keys on a hardware device such as a USB. Although hardware wallets transact online, they are stored offline for increased security. Hardware wallets can be compatible with multiple web interfaces and can support multiple currencies; it just depends on which one you decide to use. Moreover, it is very easy to complete a transaction. Users simply connect their device to any computer or device with internet access, enter a PIN, send currency, and confirm. Hardware wallets make transactions easy while keeping your money offline and away from danger.
PAPER WALLETS are easy to use and provide a very high level of security. While the term paper wallet can simply refer to a physical copy or printout of your public and private keys, it can also refer to software that is used to securely create a pair of keys, which are then printed out. Using a paper wallet is relatively straightforward. Transferring bitcoin or any other currency to your paper wallet is done by transferring funds from your software wallet to the public address specified on your paper wallet. Alternatively, if you want to withdraw or spend currency, all you have to do is transfer funds from your paper wallet to your software wallet. This process, often referred to as "clearing", can be done manually by entering your private keys or by scanning the QR code on your paper wallet.