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Are Cryptocurrencies the Future of Money?


Bitcoin and other cryptocurrencies have returned as headline news after suffering sharp sell-offs over the past few weeks. Bitcoin briefly fell below $30,000 earlier last week as cryptocurrencies and other financial markets sold off with the emergence of the Delta variant and the sharp surge in Covid-19 Delta cases.


As of the close of Monday, 7/26/21, such popular cryptos as Bitcoin, Ethereum, Litecoin, and Chainlink have recovered some of their losses, gaining 5.37%, 1.72%, 3.17%, and 8.05%, respectively. Bitcoin soared to a daily high of $40,554 today before closing at $37,196.57, while Ethereum climbed to an intra-day high of $2,430.27 before settling at 2,237.64. Litecoin jumped to $140.36 before closing at $132.29, and Chainlink sprinted to $19.94 before drifting to $18.32 by the end of trading.


The surge in many of the cryptocurrencies came on the heels of news circulating several tech giants expressed their supports for digital currencies. For instance, Amazon.com, Inc (AMZN) announced they may consider accepting digital coins as payment initially sparked the cryptocurrency recovery. Also, in the past week, bullish comments from the CEOs of Tesla (Elon Mush) and Twitter (Jack Dorsey) alluded that they have plans to incorporate virtual currencies into their respective businesses.


Whether cryptocurrencies become the future of money remains a hotly contested subject.


Understanding cryptocurrencies remains challenging, especially if you are new to crypto trading. Finding the right trading platform to buy and sell popular digital currencies such as Bitcoin, Ethereum, and Litecoin is another challenge. Enclosed below are major cryptocurrency Exchanges, Mining, and Stocks.

Exchanges

Coinbase remains one of the world's largest and best-known exchanges for crypto trading. Currently, over 10% of all cryptocurrency trading takes place at Coinbase. However, there is an increasing number of other crypto exchanges available, including Binance.US, Kraken, CEX.IO, Gemini, and Bittrex.

Bitcoin is the largest and the most popular of cryptocurrencies. It makes up nearly half of the overall market value of the entire cryptocurrency marketplace. Ethereum has emerged as the second most valuable crypto and is the crypto of choice for many non-fungible token (NFT) deals.


Ripple's XRP has also become popular with crypto traders. Some investors also favor stable coins like Tether, whose value is pegged to the US dollar. The canine-themed coin, dogecoin, started with little fanfare but is now one of the most valuable cryptos in the world.


Mining


Like gold and silver, Bitcoin is mined. Instead of using an ax and pan, mining for Bitcoin entails a high-tech process that involves solving computational and often complex mathematical puzzles to generate a block of crypto. Bitcoin miners often use hundreds and thousands of powerful computers and servers in large data centers to solve equations.


If you are interested in crypto mining, you can start with a powerful PC with a significant graphics card and elaborate software. It can become quite expensive and energy-intensive if you are serious about crypto mining.

Advocates of cryptocurrencies believe Bitcoin may be the future of money as a digital currency can be an excellent hedge against inflation since it does not involve the government printing of the Dollar, Euro, Yen, and Yuan.

But if you are new to cryptocurrency trading, how can you participate in Bitcoin and other cryptos?


Stocks


As mentioned before, Coinbase is a publicly-traded company traded on the Nasdaq exchange under the name – Coinbase Global Inc (COIN). Traders and investors can buy COIN to gain exposure to Bitcoin. Square, Inc (SQ) is a San Francisco-based company that provides payment processing solutions, but it can also facilitate the buying and selling of Bitcoin. Venmo, which is part of PayPal Holdings, Inc. (PYPL), is more than just a digital payment facilitator, as it is also a digital wallet that allows for Bitcoin transactions.


Other publicly traded companies that can be a good proxy for cryptos include Tesla Inc. (TSLA) and MicroStrategy Inc. (MSTR), which have Bitcoin and other cryptos on their balance sheet. Digital asset technology companies, which engage in mining cryptocurrencies are Marathon Digital Holding Inc. (MARA), HIVE Blockchain Technology Ltd. (HVBT), and Riot Blockchain, Inc. (RIOT).


Enclosed below is a summary of the year-to-date returns of popular cryptocurrencies ranked by volume and charts.



Source: Courtesy of StockCharts.com

Source: Courtesy of StockCharts.com

Source: Courtesy of StockCharts.com

Source: Courtesy of StockCharts.com

Source: Courtesy of StockCharts.com

Source: Courtesy of StockCharts.com

Source: Courtesy of StockCharts.com

Source: Courtesy of StockCharts.com

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