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Cryptocurrency Guide for a Complete Beginner
Every transaction that is carried out is recorded in the blockchain by people who are called miners. These miners receive pay for their services in terms of cryptocurrencies.
There are over one thousand cryptocurrencies available but most people are familiar with Bitcoin, Ethereum, LiteCoin, Zcash, Monero, Ripple, and Dash. Bitcoin is the largest cryptocurrency in terms of market share and popularity. In fact, when most people hear the word cryptocurrency, they associate it with Bitcoin alone especially if they are new to the world of cryptocurrencies. Me included.
What is Mining
As stated above, mining is updating transactions on the blockchain (digital ledger). Mining is carried out by miners who require a computer and special programs to update the virtual ledger. They update the ledger when the transactions are in blocks. A block is a group of transactions carried by users. After authentication, the block is secured by a hash and it is updated in the blockchain. There are various hardware available on Amazon for anyone who wants to start mining. It requires a high initial investment but if you have enough knowledge required to mine then you can be able to make a Return on Investment on the hardware and software that you buy.
What is an Exchange
Cryptocurrency exchanges are online platforms that enable you to carry out transactions in terms buying, selling or exchanging cryptocurrencies for other cryptocurrencies or actual cash like dollars or pounds. There are those platforms that will require you to have an account while others may allow you to carry transactions without your identification. Do a thorough research on the online platform that you want to join so that you understand the fees, transaction period, verification, the method of payment (PayPal or credit card), and if they can carry out transactions in your country. Coinbase is the most popular cryptocurrency exchange but there are others such as Kraken, Cex.io, Shapeshift, Poloniex, Bitstamp, CoinMama, Bitsquare, Local Bitcoin etcetera.
That was the just the basic terms used in cryptocurrency. If you want to trade or invest, go with caution. Remember that it's still considered a bubble for a reason. Do as much research as you can.
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