Trading na Uwekezaji katika Fedha za Kidijitali

Hello!

Let's talk about cryptocurrency and blockchain technology. We understand that for beginners, this can be challenging, so we've created this guide to gradually introduce you to the key ideas needed for a successful start in the world of blockchain.

So what is cryptocurrency?

Essentially, it's a digital form of cash. With it, you can pay for dinner with friends, buy that pair of socks you've been eyeing, or book flights and a hotel for vacation. And unlike traditional currency, cryptocurrency can be sent to your friends and family anywhere in the world, like PayPal or a bank transfer, but much more interesting! What's the catch? Traditional online payment services are owned by some organizations and operate through intermediaries. But with cryptocurrency, you can send funds directly to other users, using free software. You're your own bank, without intermediaries and without unnecessary hassle! And to start using cryptocurrency, you don't even need to register on a website with an email address and password. Just download the app to your smartphone, and you'll be able to send and receive funds in minutes.

But where does the name "cryptocurrency" come from?

This term consists of two parts: cryptography and currency. Cryptography provides security for our funds through encryption, but don't worry, all the complexities are taken care of by the apps you use. You don't need to delve into the details behind the scenes. So, this amazing virtual currency belongs to no one and is protected by encryption. But why do you need it if you already have apps for quick payment? Cryptocurrency provides you with:

• Freedom from restrictions: You can use cryptocurrency without obstacles. Unlike centralized payment services, which can freeze accounts or prevent transactions.
• Resilience to hacking: thanks to the network's design, cryptocurrency remains resistant to hacker attacks and other malicious activities.
• Cheap and fast payment method: You can send funds to someone on the other side of the world in seconds. The transaction fee is much lower than for an international money transfer. And what about Bitcoin, which you've heard about from friends or family members? It's the first and most popular cryptocurrency. WHO CREATED BITCOIN? Amazingly, no one knows for sure who created Bitcoin. The only thing known is the pseudonym of the currency's creator - Satoshi Nakamoto. Behind the pseudonym could be a person or a group of programmers. There are even absurd theories that it's a time-traveling alien or a secret government organization.

In 2008, Satoshi published a 9-page document describing the Bitcoin system technology. A few months later, in 2009, the software was released. Bitcoin served as the basis for the creation of other cryptocurrencies. Some of them were created based on the same software, others used a different concept. But what's the difference between all cryptocurrencies? It would take a week to list all existing cryptocurrencies. They differ in speed, confidentiality, and programming. In the world of cryptocurrencies, people often say, "Do Your Own Research" (DYOR). This is said with the best intentions. You should not rely on just one source of information. Be cautious when investing funds in any project. All cryptocurrencies are different.

We have prepared a list of articles for you dedicated to various coins and tokens to help those who want to learn more:

• What is Bitcoin? ("the king of cryptocurrencies") - In this article, we'll look at the basics of Bitcoin, its history, and its significance in the world of cryptocurrencies.
• What is Ethereum? (distributed network) - We'll look at important aspects of Ethereum, its functionality, and its role in blockchain technology development.
• Beginner's Guide to Blockchain Technology 1/3 - In the next article, we'll talk about blockchain technology, its basic principles, and its application in various fields.

WHAT IS BLOCKCHAIN?

Don't worry about the plethora of technical terms used to describe "blockchain". Blockchain is a kind of database, which technically is just a set of cells in a spreadsheet. However, this database has several features. Firstly, data in the blockchain cannot be changed. You can only add new information - it's impossible to simply delete or change the data in a cell. Secondly, each record (block) in the blockchain is cryptographically linked to the previous record, creating a chain of blocks. Thanks to this link, any changes in one block become obvious, as the hash of the previous block changes, and the next block contains this hash. The blockchain cannot be changed without changing all subsequent blocks, making it resistant to manipulation and data forgery. In addition to this, the blockchain is open to everyone and anyone can download it and run a full copy on their computer, making it decentralized and transparent.

In the following articles, we'll take a closer look at consensus algorithms in blockchain, Proof of Work (PoW), the double-spending problem, game theory and cryptocurrencies, and explain the Byzantine Generals' Problem. If anyone can create a block, what prevents them from cheating? The idea of creating a block with the command "Dmitry pays me a million coins" seems extremely attractive. Just like buying a Lamborghini and fur coats from Ekaterina, conducting transactions with funds you don't actually own. But such a scenario is impossible.

Thanks to cryptography, game theory, and the consensus algorithm, the system does not allow spending funds you don't actually have.

Want to delve deeper into blockchain? We have several useful articles for you:

• What is a consensus algorithm in blockchain?
• What is Proof of Work (PoW)?
• What is double spending?
• Game theory and cryptocurrencies.
• Explanation of the Byzantine Generals' Problem. If you're already familiar with these aspects and are interested in trading or investing, let's move on to the next section."

TRADING

You probably know that blockchain and cryptocurrencies are already being used in various areas, and one of the most common ways they are used is speculation. Trading often involves making profits in the short term. Traders constantly open and close positions. But how do they determine when to enter and exit trades? One of the most common methods of cryptocurrency market analysis is technical analysis (TA). Technical analysts study price history, charts, and other market data to identify trades with good profit potential. Want to start learning? We have several articles for you:

• What is technical analysis?
• Guide to candlestick charts. Once you've mastered this material, you can move on to the following topics:
• Beginner's Guide to Blockchain Technology 2/3.
• Risk management guide.
• Cryptocurrency trading strategies.
• 5 key indicators used in technical analysis.
• 12 popular candlestick patterns used in technical analysis.
• 7 common mistakes in technical analysis. INVESTMENTS

Investors focus on long-term investments, guided by fundamental investment principles. For example, they analyze the profitability of companies. Although cryptocurrencies are a new and unique type of asset, similar principles can be applied to them. Many Bitcoin investors adhere to the philosophy of "HODL" (Hold On for Dear Life). They are so confident in Bitcoin's success that they plan to hold it for a long time. Want to learn more about investing in cryptocurrencies? We have several articles for you:

• Cryptocurrency investing for beginners.
• What is fundamental analysis?
• What is asset allocation and diversification?
• What is dollar-cost averaging? Don't take our word for it, study our articles and draw your own conclusions.

PASSIVE INCOME

We've already covered trading and investing topics, but these methods usually require significant time, which is not always available. For those who are busy but aim to increase their capital, there are other options. As the great investor Warren Buffett noted: "If you don't find a way to make money while you sleep, you will work until you die." And the good news is that the world of cryptocurrency offers many opportunities for passive income. You can even earn from holding cryptocurrency! Why isn't everyone doing it? Perhaps they simply don't know about such methods. But you are now informed! One way to earn passive income is by providing loans. Other people will pay you interest for the opportunity to use your funds. Additionally, there is mining. Typically, this means receiving rewards in Bitcoins for using powerful and expensive equipment. However, there are other ways to support the operation of the cryptocurrency network, such as staking.

What is staking? It's the process of locking up cryptocurrency to earn rewards. By investing in a coin that supports staking, you can gradually increase your holdings over time.

You can learn more about staking in the following articles:

-What is staking?

-Proof of Stake.

Thus, we have covered the main ways to earn passive income in the world of cryptocurrency. We hope this guide has helped you better understand the principles of cryptocurrencies and their potential for your financial growth. We also have plenty of other articles - from beginner's guides to more in-depth reviews of complex topics!"