Neil Forrester

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Although cryptocurrencies function as a medium of exchange, many people who possess and use cryptocurrencies do not actually use them as a substitute for money. Instead, they perceive cryptocurrencies as lucrative investment opportunities, for good reasons. After all, there are already many people around the world who have become millionaires by investing their money in cryptocurrencies.

However, it should also be noted that investing also involves trading in the sense that you need to exchange fiat money for cryptocurrency and vice versa.

There is also less pressure because investing in cryptocurrencies usually involves just the simple buy and hold strategy, which is about buying a particular cryptocurrency, and then selling it at a profit after some time.

it is also true that you may lose your investment in the long run, but this usually happens because of greed, because there are people who get too greedy and fail to close their position. As a result, they get overcome by the high volatile nature of the cryptocurrency market. However, true cryptocurrency investors and traders know better. They study and analyze the market trend and know when to open and close their positions. Similar to the stock market, there is the possibility of losing your investment in the long run if you do not know what you are doing.

Whether or not investing in/trading cryptocurrencies is considered gambling depends on your approach. If you just open and close your positions at random and merely rely on luck to make a profit, then you are gambling. But, if every investment or trade that you make is backed up by research, if you take the time and effort to study the market, if you do not rely on luck but consider every action as an investment decision, then you are investing and not just gambling.

The central technology that powers Bitcoin and altcoins is known as blockchain technology, or simply blockchain. The blockchain is a public, decentralized, and distributed ledger that records all transactions. It also has a high level of security. The first decentralized blockchain was developed by Satoshi Nakamoto, who also happens to be the founder of Bitcoin.

The blockchain is composed of records known as blocks. Each block is connected to a previous block using a hash pointer. This makes every block on the chain interconnected with one another. The blockchain system is spread over a vast network of computers. Once a block or record is added to the chain, it would be almost impossible to remove, modify, or withdraw it without the consent of the majority of the users in the network. This is the concept of the 51% attack. This also means that for an attack against the blockchain to be successful, it will need to have at least 51% of the total hash power rate of the entire blockchain network. Since the blockchain network is spread over a vast network, it would be virtually impossible for an attacker to obtain at least 51% hash rate of the network. Keep in mind that this refers to the success of an attack and not the possibility of an attack. Hence, an attack with a hash power of less than 51% is still possible. However, you cannot expect for such attack to be successful.

Bitcoin vs. Altcoins
Without a doubt, Bitcoin remains to be the number one cryptocurrency in the market. In fact, it has become the leading standard of all cryptocurrencies that all other cryptocurrencies like Ethereum, Ripple, Litecoin, and others, are merely referred to as altcoins, which is short for alternative coins.

Back in 2008, bitcoin.org was registered. In November of the same year, a white paper was published in a cryptography mailing list entitled, Bitcoin: A Peer-to-Peer Electronic Cash System under the pseudonym, Satoshi Nakamoto. The following year (2009), Bitcoin was introduced in the market. Back then, it did not have any significant value. It was the people themselves who decided how much it would worth. There was this famous transaction where two pizzas were bought for 10,000 bitcoins. As of the first week of January 2018, the price of 1 bitcoin is worth around $15,000 USD.