Cryptocurrency has caused a sensation in the past few years. Whether in the workplace or at a party, Bitcoin or encrypted conversations must have appeared. From a large number of cryptocurrency returns to their growing popularity in the mainstream, it shows that you can no longer ignore cryptocurrency. The technology blockchain behind digital currency and cryptocurrency is considered to be the next disruptive revolution in this decade. Just as the Internet has completely changed the way of communication, cryptocurrency is expected to generate similar momentum in the next few years. Here are a few reasons why you can't ignore cryptocurrency.

The tremendous development of encryption technology

Let's look at the first cryptocurrency: Bitcoin. About ten years ago, Bitcoin first reached $1. At that time, it was only a small part of $1. By 2021, it reached an all-time high of $68990. Imagine if you were one of the people who bought a pile of Bitcoins 10 years ago. The same is true of Ethereum, another important asset. Five years ago, the price of ETH was less than US $1, but more than US $4000 in 2021.

Admittedly, the digital asset space has great potential, and responsible investment can bring you huge returns. However, although cryptocurrencies have generated huge returns, especially for early investors, due to the volatility of the market, it is more necessary to act cautiously. This is why Xiaobian always suggests "do your own research" (DYOR) before investing your hard-earned money into the encryption field.

Increase in institutional investment

You must have heard of the popular billionaire Elon Musk, the CEO of Tesla and SpaceX. In February 2021, more than US $1.5 billion of Bitcoin was invested. Square, Bitcoin Base, MicroStrategy and other well-known companies have also invested in Bitcoin. These largest entrepreneurs have invested hundreds of millions of dollars in cryptocurrencies.

Due to the economic impact of the global epidemic, the first largest buying wave began in 2020. At that time, because people were locked at home, leading investors and institutions were investing heavily in this new financial instrument (cryptocurrency).

Applications other than cryptocurrency

I don't know if you have heard that the first tweet released by Jack Dorsey, the CEO of Twitter at that time, sold millions of dollars. We talk about NFT because they also belong to encryption and blockchain. Blockchain areas other than digital assets include:

Decentralized financing (DeFi) - DeFi makes it possible to no longer rely on banks. It allows users to be independent of traditional methods such as banks and brokerage companies, and supports point-to-point payment, loans, fund-raising, etc.

Non-replaceable token (NFT) - "irreplaceable" means that it is unique and cannot be replaced by other things. For example, you can replace one Bitcoin with another Bitcoin, and replace one yuan with 10 dimes. But you can't substitute one NFT for another. Any unique and rare digital file, such as file, image, art form, music can be converted into NFT. Some people say that NFT is the evolution of art collection, only digital art. However, NFT has more use cases than just digital collections.

Web 3.0 protocol - current Web 2.0 applications are about connecting people like social media platforms. Think of Web 3.0 as the future of the Internet, which allows you to control your data, identity and destiny through decentralization.

summary

That's why we can't ignore the existence of cryptocurrency? The answer to this question. Cryptocurrency is also commonly referred to as "token". They are called "cryptocurrencies" because they are protected by "cryptography" technology to eliminate double expenditure, that is, the same token cannot be spent twice. Cryptocurrency operates on a point-to-point network, so that buyers and sellers can conduct direct transactions without intermediaries or central institutions. The transaction is approved and the network is jointly managed by nodes or participants.