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General information about cryptocurrency for beginners

Beginners need to understand the essence of digital assets. Of course, it is not necessary to study the theory of mathematical algorithms. Basic information about blockchain is enough.

Digital currency is based on a decentralized network – the blockchain. The system resides simultaneously on the computers of all users and has no single management. That is why it is called distributed.

In blockchain, users do everything:

  • Mining new coins.
  • Verify and validate transactions.
  • Writing data on the blockchain.
  • Participate in project management.
  • Transactions are recorded in an open system. User identity information is not available and cannot be viewed.

Crypto-assets are not secured in any way. Few people know that fiat money is also unsecured since 1971, when all countries abandoned gold. The rate of crypto-assets depends on supply and demand. As long as coins are bought, they have a price. If no one wants them, the exchange rate will fall. The price of assets is also affected by:

  • News background.
  • Regulation at the government level.
  • Events in the world.
  • Statements by businessmen, investors.
  • If you compare cryptocurrency with fiat money, you can see the differences.

What is a wallet?

Cryptocurrency is software code. Any transfers of funds are simply records in the blockchain. No one physically transfers coins, it is impossible. Addresses and keys are used for transactions. A wallet is also a program that stores necessary information. Users can find out the balance, the history of transactions, and make a transaction.

Personal and public address

Newbies do not always understand the basic concepts that are used when storing and exchanging cryptoassets. It’s worth knowing the 3 basic tools:

A wallet address is a character set containing numbers and letters. There are several writing formats: it can start with 1, 3 or bc1.

Public key (public key) – the raw data to form the wallet address. Encryption methods are used, the most popular is SHA-256.

Private key – information that is used to confirm transactions. A cryptographic function is used to generate it.

Rating of the best cryptocurrencies

Choosing an effective virtual asset is quite difficult. To invest, you need a stable coin with a growing rate. It is better to trade on highly volatile assets.

There are cryptocurrencies based on HYIPs. They can have a high price, capitalization. But after a year or even a few months, the rate drops.

Rating of the best virtual coins was compiled by crypto.ru experts. Information was collected from leading exchanges and other sites. All active projects were studied. In December 2021, the list of the top 5 crypto-assets looked as follows:

  • Bitcoin
  • Ethereum
  • Binance Coin
  • Solana
  • Ripple

When compiling the list, experts took capitalization into account. There is no such definition as cryptocurrency for beginners. Beginners can use any asset and make money from it.

If you are determined to invest in buying a cryptocurrency, such as buy Ripple, we strongly advise you to first thoroughly understand the world of cryptocurrencies.

Security Measures

The first steps in learning about cryptocurrency necessarily include the basics of data protection. Scammers create new methods to trick users every year. It is necessary to follow the security rules:

  • Use the latest versions of software.
  • Install applications only from trusted sources, better from official sites of developers.
  • Control the browser bar: fraudsters can replace a popular resource with a similar one and steal personal data.
  • Don’t follow the links to unknown sites.
  • Don’t believe the offers of different services (low commissions, bonuses, huge income). These are scammers who lure users to their site.
  • Keep secret information in a safe place, preferably written down on paper.
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