A cryptocurrency is a digital or computer-generated currency that is secured by cryptography. Now, cryptography is a method of protecting information and communications through the use of codes, so that only those for whom the information is intended can read and process it.[1] This makes it almost impossible to forge or counterfeit it. Let us understand more with the help of this article.
An essential characteristic of cryptocurrencies is that they are normally not issued by any governmental authority. The same furnishes them or at least in theory insusceptible to government manipulation or interference. Many cryptocurrencies are decentralized networks based on blockchain technology—a distributed ledger enforced by a disparate network of computers.[2]
Key Features
- Cryptocurrencies are highly used in criminal activities and thus proving it to be disadvantage.
- It is also said that it is capable of disrupting numerous areas of industries in the coming future.
- It is, however, very cheaper and includes faster money transfers and dispersed systems that which does not breakdown at a single point of failure.
Cryptocurrency Information in the USA
- It is estimated that 27 million people, 8.3% of America’s total population, currently own cryptocurrency.[3] American men are almost twice as likely to invest in crypto, with 19% of American men owning crypto versus just 10% of American women.[4] “In 2018, a survey conducted by ING found that 57% of America residents had heard of cryptocurrency. Comparing this with the 2019 survey results from IE CGC, more Americans (almost 70%) have heard of cryptocurrencies. This suggests a growing interest among Americans in purchasing cryptocurrency since 2018 which varies significantly across age and income.
- Breaking down cryptocurrency ownership by income, ownership levels are significantly higher among the very wealthy. Out of the surveyed owners, over 70% of them have an annual income above USS1 million, and 33% of them with income between US$500,000 and US$999,999.
- Majority of the US cryptocurrency owners are in the 18-44 age group (58%). 5% of them are 55 and above. This concludes that cryptocurrencies are largely owned by young, tech savvy and wealthy Americans.
- Highly educated Americans are more likely to own cryptocurrencies, 17% of them hold a doctorate education and equivalent, while 9% with a secondary education. On top of that, a higher percentage of American men (16%) own cryptocurrencies than women (7%).”[5]
USA has the highest distribution of traders on major crypto exchange and wallet Coinbase (60%), while on Binance, Bittrex and Poloniex, U.S. traders make up a substantial 24%, 27% and 28% of total crypto traders respectively.[6]
There are various types of Cryptocurrencies. Few to name are you’re your Bitcoin and Ethereum for example. The same which have been increasing its track record of cumulatively increasing its value over time. There are also cryptocurrencies that are named by and after Putin and Burger King called the PutinCoin and Whoppercoin. The same have its place in the category of cryptocurrencies marked more for their absurdity than their potential as either an investment or cryptocurrency, they show just how unique different types of cryptocurrencies can be.[7]
The thing about cryptocurrencies are that they are thousands of them, and they all have different efficacies. More importantly, what we also do not know about cryptocurrencies is that some of them are of less value and at the same time there are lot of untapped potential of these currencies. “Updated quarterly, the list ranks cryptocurrencies based on dollar volume and other data from third-party cryptocurrency exchanges, where people can buy and sell different cryptocurrencies.
Legal Status of Cryptocurrencies
Cryptocurrency laws tend to vary by each jurisdiction. As of December 2021, El Salvador was the only country in the world to allow Bitcoin as legal tender for monetary transactions.[9] It is important to point out that cryptocurrencies are not supported by any governmental or private bodies. Consequently, it has been challenging and complicated to discuss on the legal status of crypto in numerous economic jurisdictions all over the world. In addition to this, another thing that is problematic is that cryptocurrency have essentially operated beyond the nearly prevailing existing monetary organization. The legality of cryptocurrencies has its own repercussions as for their usage in conducting day-to-day dealings and trading. In June 2019, the Financial Action Task Force (FATF) recommended that wire transfers of cryptocurrencies should be subject to the requirements of its Travel Rule, which requires AML compliance.[10]
[1] What is Cryptography? Definition from SearchSecurity (techtarget.com) [2] Cryptocurrency Definition (investopedia.com) [3] Crypto Ownership Data for United States of America 2021 | TripleA (triple-a.io) [4] 16% of Americans say they have invested in, traded or used cryptocurrency | Pew Research Center [5] Crypto Ownership Data for United States of America 2021 | TripleA (triple-a.io) [6] Refer Footnote 3. [7] Most Popular Types of Cryptocurrency | NextAdvisor with TIME [8] Most Popular Types of Cryptocurrency | NextAdvisor with TIME [9] Cryptocurrency Definition (investopedia.com) [10] Baker Mckenzie. Most Countries Have Failed To Implement Travel Rule.
