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What Is Cryptocurrency?

A cryptocurrency (or crypto) is a form of digital cash that enables individuals to transmit value in a digital setting.

A cryptocurrency (or crypto) is a form of digital cash that enables individuals to transmit value in a digital setting.

You may be wondering how this sort of system differs from PayPal or the digital banking app you have on your phone. They certainly appear to serve the same use cases on the surface – paying friends, making purchases from your favorite website – but under the hood, they couldn’t be more different.

What makes cryptocurrency unique?

Cryptocurrency is unique for many reasons. Its primary function, though, is to serve as an electronic cash system that isn’t owned by any one party.

A good cryptocurrency will be decentralized. There isn’t a central bank or subset of users that can change the rules without reaching consensus. The network participants (nodes) run software that connects them to other participants so that they can share information between themselves.

Централизованные и децентрализованные системы Centralized vs. decentralized networks.

On the left is what you’d expect something like a bank to use. Users must communicate via the central server. On the right, there is no hierarchy: nodes are interconnected and relay information between themselves.

The decentralization of cryptocurrency networks makes them highly resistant to shutdown or censorship. In contrast, to cripple a centralized network, you just need to disrupt the main server. If a bank had its database wiped and there were no backups, it would be very difficult to determine users’ balances.

In cryptocurrency, nodes keep a copy of the database. Everyone effectively acts as their own server. Individual nodes can go offline, but their peers will still be able to get information off of other nodes.

Cryptocurrencies are therefore functional 24 hours a day, 365 days a year. They allow for the transfer of value anywhere around the globe without the intervention of intermediaries. This is why we often refer to them as permissionless: anyone with an Internet connection can transmit funds.

Why is it called cryptocurrency?

The term “cryptocurrency” is a portmanteau of cryptography and currency. This is simply because cryptocurrency makes extensive use of cryptographic techniques to secure transactions between users.

What is public-key cryptography?

Public-key cryptography underpins cryptocurrency networks. It’s what users rely on to send and receive funds.

In a public-key cryptography scheme, you have a public key and a private key. A private key is essentially a massive number that would be impossible for anyone to guess. It’s often hard to wrap your head around just how big this number is.

For Bitcoin, guessing a private key is about as likely as correctly guessing the outcome of 256 coin tosses. With current computers, you wouldn’t even be able to crack someone’s key before the heat death of the universe.

Anyways, as the name might suggest, you need to keep your private key secret. But from this key, you can generate a public one. The public one can safely be handed out to anyone. It’s feasibly impossible for them to reverse-engineer the public key to get your private one.

You can also create digital signatures by signing data with your private key. It’s analogous to signing a document in the real world. The main difference is that anyone can say with certainty whether a signature is valid by comparing it with the matching public key. This way, the user doesn’t need to reveal their private key, but can still prove their ownership of it.

In cryptocurrencies, you can only spend your funds if you’ve got the corresponding private key. When you make a transaction, you’re announcing to the network that you want to move your currency. This is announced in a message (i.e., transaction), which is signed and added to the cryptocurrency’s database (the blockchain). As mentioned, you need your private key to create the digital signature. And since anyone can see the database, they can check that your transaction is valid by checking the signature.

Who invented cryptocurrency?

There have been a handful of attempts at digital cash schemes over the years, but the first of the cryptocurrencies was Bitcoin, which was released in 2009. It was created by a person or group of people using the pseudonym Satoshi Nakamoto. To this day, their true identity remains unknown.

Bitcoin spawned a huge number of subsequent cryptocurrencies – some aiming to compete, and others seeking to integrate features not available in Bitcoin. Nowadays, many blockchains do not just allow users to send and receive funds, but to run decentralized applications using smart contracts. Ethereum is perhaps the most popular example of such a blockchain.

What is the difference between cryptocurrencies and tokens?

At first glance, cryptocurrencies and tokens appear identical. Both are traded on exchanges and can be sent between blockchain addresses. Cryptocurrencies are exclusively meant to serve as money, whether as a medium of exchange, store of value, or both. Each unit is functionally fungible, meaning that one coin is worth as much as another. Bitcoin and other early cryptocurrencies were designed as currency, but later blockchains sought to do more. Ethereum, for instance, does not just provide currency functionality. It allows developers to run code (smart contracts) on a distributed network, and to create tokens for a variety of decentralized applications.

Tokens can be used like cryptocurrencies, but they’re more flexible. You can mint millions of identical ones, or a select few with unique properties. They can serve as anything from digital receipts representing a stake in a company to loyalty points.

On a smart-contract-capable protocol, the base currency (used to pay for transactions or applications) is separate from its tokens. In Ethereum, for instance, the native currency is ether (ETH), and it must be used to create and transfer tokens within the Ethereum network. These tokens are implemented according to standards like ERC-20 or ERC-721.

What is a crypto wallet?

Essentially, a cryptocurrency wallet is something that holds your private keys. It can be a purpose-built device (a hardware wallet), an application on your PC or smartphone, or even a piece of paper.

Wallets are the interface that most users will rely on to interact with a cryptocurrency network. Different types will offer different kinds of functionality – evidently, a paper wallet cannot sign transactions or display current prices in fiat currency.

For convenience, software wallets (e.g. Trust Wallet) are considered superior for day-to-day payments. For security, hardware wallets are virtually unmatched in their ability to keep private keys away from prying eyes. Cryptocurrency users tend to keep funds in both types of wallets.

How does blockchain work?

What is a blockchain?

A blockchain is a special kind of database where data can only be added (and not removed or changed). Transactions are periodically added to a blockchain inside what we call blocks (made up of transaction information and other important metadata).

We call the structure a chain because each block’s metadata includes a piece of information that links it to the previous one. Specifically, it includes a hash of the previous block, which you can think of like a unique digital fingerprint.

The probability of two pieces of data giving you the same output from a hash function is infinitesimally low. Because of this, if someone attempted to modify an older block, its hash would be different, meaning that the next block’s hash would also be different, and so on. It’s therefore obvious if a block has been changed, because all the blocks that come after it would need to be changed as well.

how blockchain uses the hash from the previous block to produce the following block Each block’s hash is included in the next block. This forms the chain of blocks, or blockchain.

The blockchain is downloaded in full by network participants. Remember how we said that anyone can validate transactions and signatures with public-key cryptography? When a node receives a block, it performs a number of checks. If anything is invalid, the block is rejected.

When a node receives a valid block, it makes its own copy of it and then propagates that block to other nodes. They then do the same until the block has spread throughout the whole network. This process is also carried out for unconfirmed transactions – that is, transactions that have been broadcast, but not yet included in the blockchain.

How are blocks added to a blockchain?

A blockchain's integrity is undermined if false financial information can be recorded. At the same time, there is no administrator or leader in the distributed system that maintains the ledger – so how do we ensure that participants are acting honestly?

Satoshi proposed a Proof of Work system, which allowed anyone to suggest a block to append to the blockchain. To put forward a block, users must sacrifice computational power to guess at a challenge set out by the protocol.

Proof of Work is the most tried-and-tested scheme for achieving consensus amongst users, but it is by no means the only one. Alternatives such as Proof of Stake are increasingly being explored, although they have yet to see proper implementation in their true form (though hybrid consensus mechanisms have been around for some time).

How does crypto mining work?

Heatmap of retailers

The process referred to above is known as mining. If the miner finds a solution, the block they constructed would extend the chain. As a result, they would receive a reward denominated in the blockchain’s native currency.

The cryptographic puzzle miners must solve involves repeatedly hashing data to produce a number that falls below a particular value. Hashing with a one-way function means that given the output, it is virtually impossible to guess the input. But given the input, it is trivial to verify the output. In this way, any participant can verify that the miner has produced a ‘correct’ block, and rejects those that are invalid. In this case, the miner receives no reward and has wasted resources by trying to forge an invalid block.

This results in some interesting game theory that makes it costly for an actor to attempt to cheat, but profitable for them to act honestly. No malicious entity has the resources to indefinitely attack a strong network. Therefore, we expect those with resources to make a return on their investment by participating correctly.

Can cryptocurrencies scale?

As you can probably tell, distributed networks aren’t very efficient. Unfortunately, cryptocurrencies can only be secure and censorship-resistant if all nodes can sync a copy of the blockchain. The lower the requirements to keep pace, the easier it will be for people to join.

You can see why a blockchain that only adds a small block every ten minutes is preferable, in this regard, to one that adds a huge block every five minutes. The latter would require nodes to run high-powered computers to stay in sync, and push lower-powered ones to go offline. This would result in greater centralization, as there are fewer peers on the network.

But with smaller blocks, we can’t achieve many transactions per second (TPS). That also means that, in busy periods, transactions can take a while to be added to the blockchain. It’s inconvenient if you want to make a fast payment, but it’s the price that must be paid for decentralization.

We call this issue a scalability dilemma. A system that scales well is one that can easily adapt to increased throughput with minimal downsides. Blockchains do not scale well – as we’ve explained, simply upping the throughput with bigger blocks undermines the entire purpose of the distributed network.

To increase TPS in a way that doesn’t harm the network’s decentralization, off-chain scaling appears to be a viable approach. This encompasses a broad range of solutions – centralized and decentralized – that allow transactions to be made without logging them to the blockchain.

Who makes decisions for cryptocurrency software?

Cryptocurrency networks are opt-in. Nobody’s forcing you to run software that you don’t want to. In a good protocol, the code will be entirely open-sourced so that users can be sure of the system’s fairness and security.

Generally, cryptocurrencies enable anyone to participate in their development. New features or edits to the code are vetted by a community of developers before being agreed on and published. From there, users can review the code themselves and choose to run it or not.

Some updates will be backward-compatible, meaning that updated nodes will still communicate with older ones. Others will not be backward-compatible – older nodes will be “kicked off” the network unless they’re updated. Check out Hard Forks and Soft Forks for an explanation of this.

How can I invest in cryptocurrency?

What cryptocurrency should I buy?

This is a choice only you can make – you should Do Your Own Research (DYOR) and decide based on your own analysis. With that said, there are many tools out there that can help you make better decisions. For example, Binance Research provides excellent insight & analysis pieces on the market, along with comprehensive reports on individual projects.

If you’d like to be able to assess what cryptocurrency to buy, it’s absolutely essential for you to first understand how Bitcoin works. Good news, that’s exactly why we created our What is Bitcoin? guide!

What should I learn before investing in cryptocurrencies?

Where do we even start? There are a plethora of ways to analyze the financial markets, and generally, most professional investors will use widely different strategies. On a high level, though, there are two main schools of thought to assess an investment: fundamental analysis (FA) and technical analysis (TA).

Fundamental analysis is a method to assess an asset’s valuation based mainly on economic and financial factors. Analysts who use this method look at both macroeconomic and microeconomic factors, industry conditions, or the business underlying the asset (if there’s one). In the case of cryptocurrencies, they may also look at public blockchain data, which are sometimes referred to as on-chain metrics.

This can involve looking at the number of transactions, addresses, the top holders, the network hash rate, and countless other pieces of information. The goal with this analysis is to come up with a valuation for the asset and compare it to its current valuation. In the end, this approach aims to determine whether the asset is currently undervalued or overvalued.

With all that said, it’s important to remember that cryptocurrencies are a new and flourishing asset class. Fundamental analysis has little room to shine when it comes to determining their valuation. Simply put, there’s no standardized framework for determining the valuation of cryptocurrencies, and most existing models can’t be trusted to a high degree. The success or failure of a cryptocurrency project may depend on many different factors, for which no current framework can account for.

Technical analysts take a different approach. Unlike fundamental analysts, technical analysts don’t try to determine the intrinsic value of an asset. Instead, they evaluate trading and investment opportunities based on historical trading activity. They do that by focusing on price movements, chart patterns, indicators, and various other charting tools to evaluate a market’s strength or weakness. In essence, technical analysts believe that the previous price movements of an asset can be valuable to try to predict its future price movements.

Since technical analysis can be applied to essentially any market with historical data, it’s widely used by cryptocurrency traders.

So which one should you learn? Well, why not both? Most market analysis tools work best when used in combination with other tools. In either case, it’s absolutely vital to understand financial risk and risk management, and never to invest more than you can afford to lose.

Where to buy cryptocurrencies

There are various ways to buy cryptocurrencies. The first thing you’ll need to do, though, is convert your fiat currency into cryptocurrency. Then, you can choose to either HODL, trade it with other cryptocurrencies, or lend it and earn interest. Let’s take a look at the different types of cryptocurrency exchanges.

Centralized exchanges (CEX)

You might find the concept of a centralized exchange a bit confusing since cryptocurrencies are often referred to as decentralized. In short, centralized exchanges are online platforms that facilitate trades by connecting buyers and sellers.

The way this works is that users deposit their fiat money or cryptocurrency to the exchange and trade within its internal systems. If you’re familiar with how cryptocurrency wallets work, you’ll know that, in this case, your cryptocurrency is custodied by the exchange. But it should be fairly easy for you to withdraw your funds and keep them in your own wallet, if you want to.

Some might prefer keeping their funds on the exchange, either because they trade regularly or for convenience. However, if the exchange is hacked, user funds might be at risk.

Decentralized exchanges (DEX)

Decentralized exchanges are different. When you’re using a DEX, there are no custodians involved. In fact, a more accurate way of referring to this type of exchange would be non-custodial exchange.

Here’s what happens when you trade on a DEX. Instead of depositing your funds to the exchange’s wallet, you’re trading directly from your own wallet. When a trade is executed, the funds are transferred directly on the blockchain using the magic of smart contracts.

Since there’s no entity acting as a custodian, some consider this a safer choice than CEXs. Another upside might be that most DEXs don’t require you to provide any personal information other than a blockchain wallet address. At the same time, taking custody of your own funds requires some amount of technical expertise, and you’re entirely at your own responsibility.

P2P exchanges

A peer-to-peer (P2P) exchange is also a place that connects buyers and sellers, but it’s different from both a CEX and a DEX. In this case, the exchange itself does nothing more than connect buyers and sellers, and they can settle the transaction in whatever way they agree on. So, the deposit and settlement method can be decided by buyers and sellers for each individual transaction.

How to buy cryptocurrencies

How to buy cryptocurrencies on Binance

  • Log in to Binance, or register if you don’t already have an account.
  • Go to the Buy and Sell Cryptocurrency portal.
  • Select the cryptocurrency you’d like to buy, and the currency you’d like to pay with.
  • Select your payment method.
  • If prompted, insert your card or bank details, and complete identity verification.
  • You’re done! Your cryptocurrency will be credited to your Binance account.

How to buy cryptocurrencies on Binance DEX

Using a DEX is a bit more complicated than the other available options.

Here’s what you need before you start:

  • A wallet that can connect to Binance DEX (we recommend Trust Wallet).
  • Some BNB to pay for transaction fees.

How to buy cryptocurrencies on Binance P2P

  • Log in to Binance, or register if you don’t already have an account.
  • Go to the Binance P2P portal.
  • Select whether you’d like to buy or sell.
  • Filter by currency, payment method, or other trade requirements.
  • Select a listing that meets your requirements, or post your own listing.

Frequently asked cryptocurrency questions

Very few countries place an outright ban on buying, selling, and storing cryptocurrency. In the vast majority of the world, Bitcoin and other virtual currencies are perfectly legal. But before getting started with them, you should check if your jurisdiction permits it.

It’s important to remember that each country has a different approach to regulating cryptocurrency activities. Make sure that you’re not in violation of any rules surrounding taxation or compliance.

Is crypto dead?

is crypto dead header image

The media have pronounced cryptocurrency dead hundreds of times in the last decade. And yet, it continues to work just as it did in 2009. That’s not to say it isn’t volatile – the price fluctuates wildly. To those solely trying to turn a profit, bear markets can be disheartening.

However, it would be a mistake to describe cryptocurrency as “dead.” It continues to attract new users, and the technology and infrastructure are only growing more sophisticated.

The core innovations of Bitcoin and Ethereum will undoubtedly play an important part in reshaping our existing monetary systems to be more suitable for the current age. Immutability, censorship-resistance, trustlessness, or near-instant transactions using a public monetary system could completely revamp the mechanics of economic activity on the Internet.

Is cryptocurrency safe?

There’s a degree of risk taken on with cryptocurrency. If you forget the password to access your bank account, you can just have it reset through customer support. But, if you forget or lose the private keys that give you access to your crypto, there’s no one that can help you. Using a reputable exchange can be a more forgiving option – it requires trust, but you aren’t at risk of losing your private keys.

Public-key cryptography has not yet been broken. With good security measures, you’re probably more likely to have any of your other online accounts hacked than you are to have your funds stolen. Best practices include being aware of common scams (social engineering, phishing, etc.), keeping your private keys offline at all times, and backing them up in a secure location.

Is cryptocurrency anonymous?

Your name isn’t connected to your cryptocurrency addresses – they look like random strings of numbers and letters on the blockchain. Be careful when assuming that this makes you anonymous, though. You’re pseudonymous – you still have a sort of on-chain identity, it just isn’t the one you use in real life.

There are certain methods that may allow people to tie IP addresses to your activities. On this front, things like dusting attacks and other analysis techniques can be used to deanonymize you. Remember that blockchains are essentially massive public databases. If you’re concerned about your privacy, you should try to make it as difficult as possible for others to link your transactions to your name. Cryptocurrencies like Bitcoin aren’t private by default, but methods like coin mixing and CoinJoins can make analysis heuristics unreliable.

A small subset of cryptocurrencies (known as privacy coins) are able to obfuscate the source, destination and amount of funds in transactions, using methods like Confidential Transactions. They have stronger privacy by default but are not totally resistant to deanonymization.

Is cryptocurrency valuable?

In financial systems, value is a shared belief. Just like with anything valuable, the value isn’t inherent to cryptocurrency itself – it’s assigned by people. In other words, something has value if people believe it does. This is true regardless if the object of value is a precious metal, a piece of paper, or some bits in a database.

With all that said, some consider cryptocurrencies and Bitcoin, something akin to a scarce digital commodity. Due to its predictable issuance rate and monetary policy, some argue that Bitcoin may act as a store of value in the future, similar to gold. Since Bitcoin has existed only for a little more than a decade, it’s yet to be seen whether it will stand the test of time in this regard.

Are all digital currencies cryptocurrencies?

No. You might have heard that many nation-states and central banks are working on creating their own versions of digital currency. However, these are just that – digital currencies. As a matter of fact, they’re often collectively referred to as central bank digital currencies (CBDCs). These are essentially digital versions of fiat money, and they don’t enjoy most of the benefits of cryptocurrencies. They are issued and declared legal tender by a central government and typically don’t use a distributed ledger, such as a blockchain, to keep a record of transactions.

You might also have heard about Facebook Libra, another type of digital currency. On the plus side, it’s planned to be built on an open-source blockchain system. However, it wouldn’t be permissionless such as Bitcoin or Ethereum, meaning that participants would need more than a simple Internet connection to use it. What’s more, the project and the activity on it would be run and managed by an association made up of a few selected members.

So, despite CBDCs and other forms of digital money making use of blockchain or cryptography, they’re quite different from cryptocurrencies such as Bitcoin.

What is the market capitalization of a cryptocurrency?

When you’re looking at the price of a cryptocurrency, you only see part of the picture. An equally important metric is how many individual units of that cryptocurrency exist out there, i.e., the supply.

More specifically, to assess the valuation of a cryptocurrency network, you need to know how many individual units exist right now. This is called the circulating supply. Different cryptocurrencies may adopt different issuance schedules, so it’s important to understand how the issuance works with each network.

The market capitalization (or market cap) is the price of an individual unit multiplied by the circulating supply.

Market Capitalization = Circulating Supply * Price

As you might imagine, the market capitalization of a cryptocurrency network is a more accurate representation of the value in the network than the price of an individual unit. A network with a lower-priced coin but a higher circulating supply might have a higher total valuation (market cap) than one with a higher-priced coin but lower circulating supply. And the opposite could also be true in certain cases.

It’s worth noting, however, that the market capitalization does not represent how much money entered a particular market. For instance, it’s a common misconception among newcomers that the Bitcoin market cap represents the total amount of money invested in Bitcoin. But that doesn’t make sense because the market cap depends on the price and supply.

Why do I need to pay transaction fees?

If you send one bitcoin to another address, you’ll notice that the address receives slightly less than what you’ve sent. That’s because you pay a small fee to reward miners for adding your transaction to the blockchain.

Many cryptocurrencies use a similar mechanism to incentivize users to secure the network. In Proof of Work systems, transaction fees are usually bundled with freshly-minted coins (the block subsidy) to form the block reward.

You can adjust the fee depending on the urgency of your transaction. Rational miners will always seek to make as much revenue as possible, so they’ll prioritize transactions with higher fees. You can look at the current pending transactions to get an idea of the average fee, and set your own accordingly.

I lost my key. Can I get my funds back?

If you’re sure you lost your keys, chances are you will never get them back. The great benefit of cryptocurrencies is the removal of custodians and middlemen from managing financial transactions. The downside of that, however, is that the responsibility is now entirely in your hands. So you need to be extremely careful not to lose your private keys, as they’re what give you ownership of your funds.

What is the future of cryptocurrency?

What the future of cryptocurrency will look like depends entirely on who you ask. Some believe that Bitcoin will rise to replace gold in the digital age and disrupt the existing financial system. Others argue that cryptocurrencies will always be a secondary system, existing as a niche market. We also have the ones that believe Ethereum will become a distributed computer, serving as the backbone of a new Internet.

Skeptics predict the industry will eventually collapse, while enthusiasts are happy with cryptocurrencies remaining niche monetary systems. There are many possible outcomes – it’s simply too early to say with certainty what will happen even a year from now. But we can’t deny that there is a huge potential for growth.

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APY vs APR - What’s the Difference?

APY vs APR - What’s the Difference?
You have likely seen these two similar-sounding terms, APY and APR, when looking into decentralized finance (DeFi) products. APY, or annual percentage yield, incorporates interest compounded quarterly, monthly, weekly, or daily, while APR, or annual percentage rate, doesn’t. This simple distinction can make a significant difference to the calculations for returns over a period of time. It is therefore important to understand how these two metrics are calculated and what it means for the returns that you can earn on your digital funds.
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The Merge Ethereum Upgrade - All You Need To Know

The Merge Ethereum Upgrade - All You Need To Know
The Ethereum mainnet will soon shift from a Proof of Work to a Proof of Stake consensus mechanism in an upgrade called The Merge. The Merge is part of a series of major Ethereum ecosystem upgrades, which also include The Surge, The Verge, The Purge, and The Splurge. The goal of these upgrades is to make Ethereum more scalable and energy efficient. The Merge will combine the Ethereum mainnet with the Proof of Stake Beacon Chain and is expected to happen in September 2022.
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Blockchain Use Cases - Governance

Blockchain Use Cases - Governance
Although blockchain technology was initially designed to function as the architecture of Bitcoin, it's now being used in many different fields. One of these fields is that of governance, where distributed systems have the potential to greatly change the public sector.
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Top 7 Technologies that Power the Metaverse

Top 7 Technologies that Power the Metaverse
The metaverse is a concept of a 3D digital world. It consists of virtual spaces that you can explore using an avatar you create. In the metaverse, you can play games, go shopping, hang out with friends at a virtual coffee shop, work with your colleagues in a virtual office, and much more. Some video games and work socialization tools have already implemented certain metaverse elements into their ecosystems.
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Blockchain Use Cases - The Internet of Things (IoT)

Blockchain Use Cases - The Internet of Things (IoT)
Since the early days of the Digital Revolution in the 1950s, a wide range of groundbreaking technology has been created. Despite being initially restricted to just a few individuals, the industry developed very quickly, and most of the novel technologies became increasingly widespread and accessible.
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Web2 vs. Web3 - Which Is Better?

Web2 vs. Web3 - Which Is Better?
While the current version of the Internet, Web2, is used by millions, it is not without its flaws. Issues regarding data ownership, censorship, and security continue to plague the Internet, spurring the conceptualization of a new and improved version called Web3. This future Internet seeks to include technologies like blockchain, artificial intelligence (AI), and augmented reality (AR). At its core, an ideal Web3 should offer benefits such as data ownership and confidentiality. Web3 is touted to be an improved version of Web2 but what exactly is it, and is it better?
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What Is an ICO (Initial Coin Offering)?

What Is an ICO (Initial Coin Offering)?
An Initial Coin Offering (or ICO) is a method for teams to raise funds for a project in the cryptocurrency space. In an ICO, teams generate blockchain-based tokens to sell to early supporters. This serves as a crowdfunding phase – users receive tokens that they can use (either immediately or in the future), and the project receives money to fund development.
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How to Build a Well-Balanced Crypto Portfolio

How to Build a Well-Balanced Crypto Portfolio
Balancing a crypto portfolio is not that different from balancing a traditional portfolio. You can easily reduce your overall risk according to your profile and investment strategy. All it takes to get started is simply diversifying your investments among different cryptocurrencies.
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General Security Principles

General Security Principles
Cryptocurrencies have brought lots of exciting possibilities, but they are also full of risks and dangers for the inexperienced. Follow the three main security principles outlined below to mitigate some risks associated with using, holding, and trading cryptocurrencies.
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What Is Social Engineering?

What Is Social Engineering?
In a broader sense, any kind of manipulation linked to behavioral psychology can be considered social engineering. However, the concept is not always related to criminal or fraudulent activities. In fact, social engineering is being widely used and studied in a variety of contexts, in fields like social sciences, psychology, and marketing.
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Market Makers and Market Takers Explained

Market Makers and Market Takers Explained
Markets are made up of makers and takers. The makers create buying or selling orders that aren’t carried out immediately (e.g., “sell BTC when the price hits $15k”). This creates liquidity, meaning it’s easier for others to instantly buy or sell BTC when the condition is met. The people that buy or sell instantly are called takers. In other words, the takers fill the orders created by the makers.
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Game Theory and Cryptocurrencies

Game Theory and Cryptocurrencies
Game theory is fundamental to the development of cryptocurrencies and is one of the reasons why Bitcoin managed to thrive for over a decade, despite numerous attempts to disrupt the network.
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What Is a Decentralized Exchange (DEX)?

What Is a Decentralized Exchange (DEX)?
You probably know the drill with cryptocurrency exchanges. Sign up with your email, come up with a strong password, verify your account, and start trading cryptocurrency. Decentralized exchanges are like that, minus the hassle of sign-ups. In most cases, there’s no depositing or withdrawing crypto. The trade happens directly between two users’ wallets, with limited (if any!) input from a third-party.
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An Introduction to Confidential Transactions

An Introduction to Confidential Transactions
It’s often considered critical to the functioning of a blockchain that the system is transparent. This means that every node on the network can store a copy and verify that no rules are being broken. For many distributed ledgers, anyone can load up an online block explorer that allows them to search through blocks, transactions, and addresses.
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What Is Shorting in the Financial Markets?

What Is Shorting in the Financial Markets?
There are countless ways to generate profits in the financial markets. Some traders will use technical analysis, while others will invest in companies and projects using fundamental analysis. As such, you, as a trader or investor, also have many different options to create a profitable trading strategy.
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The Wyckoff Method Explained

The Wyckoff Method Explained
Данный торговый метод был разработан Ричардом Вайкоффом в начале 1930-х годов. Он состоит из ряда принципов и стратегий, изначально разработанных для трейдеров и инвесторов. Вайкофф посвятил значительную часть своего жизненного опыта для изучения поведений на рынке, и его работа до сих пор оказывает влияние на большую часть современного технического анализа (ТА). В настоящее время, метод Вайкоффа применяется ко всем видам финансовых рынков, хотя изначально он был ориентирован только на акции.
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An Introduction to The Dow Theory

An Introduction to The Dow Theory
Essentially, the Dow Theory is a framework for technical analysis, which is based on the writings of Charles Dow concerning market theory. Dow was the founder and editor of the Wall Street Journal and the co-founder of Dow Jones & Company. As part of the company, he helped create the first stock index, known as the Dow Jones Transportation Index (DJT), followed by the Dow Jones Industrial Average (DJIA).
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Об инвестировании, хаосе и аппроксимации рынка

Об инвестировании, хаосе и аппроксимации рынка
Данную статью я решил написать, потому что мне часто пишут в личных сообщениях с вопросами, насколько профессиональна ваша команда управляющих? Владеете ли вы инсайдерской информацией при торговле? Как поведет себя портфель на падающем рынке? и так далее. Ниже я постараюсь прояснить стратегии, и кратко объяснить почему они работают. На просторах Сети полным полно торговых стратегий, материалов, мануалов, готовых решений, сборок, обученных нейросетей и прочего добра, посвященного прогнозированию цен на криптовалютные и традиционные биржевые активы, пахнущего быстрыми и легкими доходами с минимумом усилий. И хоть пишут их разные люди, с разными подходами, на разных платформах и с разными парадигмами, у них всех есть один неизменный общий атрибут — они не работают. Другими словами с их помощью невозможно со стопроцентной вероятностью спрогнозировать куда пойдет график в том или ином отрезке времени в будущем.
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What Is Livepeer (LPT)?

What Is Livepeer (LPT)?
Livepeer is a decentralized video protocol built on the Ethereum blockchain. It was designed for anyone to seamlessly integrate video content into applications in a decentralized manner and at a fraction of the cost of traditional solutions. Decentralization of video processing is accomplished by distributing the transcoding process to a network of node operators. Transcoding is an essential step in ensuring smooth delivery of video content to end users. It involves taking raw video files and converting them to the optimal state for each end user, based on factors such as device screen size or internet connection.
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Что делать с долларом сегодня

Что делать с долларом сегодня
Сегодня в России для россиян доллар становится очень токсичной валютой. То есть им (долларом) тяжело владеть, если ты владеешь им, то на тебя накладывают различные комиссии, вы наверное уже в курсе, что есть комиссия за хранение валюты на брокерских счетах, на банковских счетах, блокируют swift переводы и так далее. В чём главная опасность? И почему банки сейчас так выжимают людей из доллара? Главная опасность в возможной блокировке российских банков, а точнее корреспондентских счетов российских банков в иностранных банках. Что это такое? В чём суть?
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What Are Nodes?

What Are Nodes?
The definition of a node may vary according to the context. When it comes to computer or telecommunication networks, nodes may act either as a redistribution point or as a communication endpoint. Usually, a node consists of a physical network device, but there are some cases where virtual nodes are used.
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Coin Mixing and CoinJoins Explained

Coin Mixing and CoinJoins Explained
Bitcoin is often referred to as digital cash, but this is a questionable comparison. If Alice pays Bob ten dollars in cash, Bob has no idea where the money came from. If he later goes on to give it to Carol, she will be unable to deduce that Alice was once in possession of it. Bitcoin is different because of its inherent public nature. The history of a given coin (more precisely, an unspent transaction output or UTXO) can be trivially observed by anyone. It’s a bit like writing the transaction amount and names of participants on a bill every time it’s used.
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What Is Anti-Money Laundering (AML)?

What Is Anti-Money Laundering (AML)?
AML regulations attempt to stop the illegal laundering of illicit funds. Individual governments and multinational organizations like the FATF legislate against money laundering activities. Money laundering takes “dirty” money and turns it into clean money. This can be done by disguising the origins of the funds, mixing them with legitimate transactions, or investing them into legal assets.
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What Are Crypto Cards and How Do They Work?

What Are Crypto Cards and How Do They Work?
A typical crypto card lets you earn crypto rewards or instantly convert your crypto to fiat currency to pay for goods and services. Both Mastercard and Visa issue crypto cards, meaning you can use your crypto in millions of locations globally. A prepaid crypto card is similar to a debit card in that it has to be pre-loaded with crypto to spend. You can get a crypto card from a licensed issuer such as a crypto exchange or bank. However, crypto cards aren't without risk. Your funds stored on the card can still lose their market value, and any transactions you make with your card are likely to be taxable.
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What Is Play-to-Earn and How to Cash Out?

What Is Play-to-Earn and How to Cash Out?
Play-to-earn games allow users to farm or collect crypto and NFTs that can be sold on the market. By playing the game regularly, each player can earn more items or tokens to sell and generate an income. Some players have even begun to supplement or replace their salaries playing these blockchain games. However, such activity involves risk, as you typically need to put up an initial investment to purchase characters and items to play the game. Blockchain helps guarantee the collectibility of these items and create working digital economies. Blockchain technology and NFTs allowed for the creation of digital items that are impossible to duplicate. This created the concept of digital scarcity.
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What Is Uniswap and How Does It Work?

What Is Uniswap and How Does It Work?
Uniswap is a set of computer programs that run on the Ethereum blockchain and allow for decentralized token swaps. It works with the help of unicorns (as illustrated by their logo). Traders can exchange Ethereum tokens on Uniswap without having to trust anyone with their funds. Meanwhile, anyone can lend their crypto to special reserves called liquidity pools. In exchange for providing money to these pools, they earn fees. How do these magical unicorns convert one token to the other? What do you need to use Uniswap? Let’s read on.
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Mining Pools Explained

Mining Pools Explained
Mining is integral to the security of Proof of Work blockchains. By computing hashes with certain properties, participants are able to secure cryptocurrency networks without the need for a central authority. When Bitcoin first launched in 2009, anyone with a regular PC could compete with other miners to guess a valid hash for the next block. That’s because the mining difficulty was low. There wasn’t much hash rate on the network. As such, you didn’t need specialized hardware to add new blocks to the blockchain.
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Who Is Satoshi Nakamoto?

Who Is Satoshi Nakamoto?
Satoshi Nakamoto is the pseudonym behind the development of Bitcoin and the authorship of the original Bitcoin whitepaper. The question “who is Satoshi Nakamoto?” has led to speculation of their true identity as well as people falsely claiming they are Satoshi Nakamoto. The creator of Bitcoin has been clouded in mystery for more than a decade. However, it’s clear that Satoshi still owns bitcoins since their public keys were traced from the genesis block, which Satoshi mined.
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What Is Cryptocurrency Mining?

What Is Cryptocurrency Mining?
Cryptocurrency mining refers to the process of verifying and validating blockchain transactions. It’s also the process that creates new units of cryptocurrencies. The work done by miners requires intensive computational resources, but it’s what keeps a blockchain network secure. Honest and successful miners are rewarded for their work with newly created cryptocurrencies plus transaction fees.
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A Quick Guide to Binance Dual Investment

A Quick Guide to Binance Dual Investment
We all know that to get a return on an investment, we need to buy low and sell high. Investing in cryptocurrency is no different. Binance Dual Investment provides a great way to seize Buy Low and Sell High opportunities while also providing you with additional returns. Let’s dive into how it works and exactly how you can get started.
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Hybrid PoW/PoS Consensus Explained

Hybrid PoW/PoS Consensus Explained
A blockchain’s consensus mechanism serves to ensure that there is agreement among participants on the current state of the blockchain. The consensus mechanism determines who is able to add new blocks of transactions, and one of its primary aims is to ensure that the chain is not re-written.
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Your Guide to Binance Earn

Your Guide to Binance Earn
Not interested in trading but still looking to increase your crypto holdings? Is the 0.05% interest your local bank offers on your savings account not exciting enough? Well, you’ll find alternative choices within the Binance Earn product suite. Binance Earn is your crypto savings account. Here, you’ll find a great variety of options for earning passive income with your crypto holdings.
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Delegated Proof of Stake Explained

Delegated Proof of Stake Explained
The Delegated Proof of Stake (DPoS) consensus algorithm is considered by many as a more efficient and democratic version of the preceding PoS mechanism. Both PoS and DPoS are used as an alternative to the Proof of Work consensus algorithm, since a PoW system requires, by design, lots of external resources. The Proof of Work algorithm makes use of a large amount of computational work in order to secure an immutable, decentralized and transparent distributed ledger. Contrarily, PoS and DPoS require fewer resources and are, by design, more sustainable and eco-friendly. To understand how Delegated Proof of Stake works, one must first grasp the basics of the Proof of Work and Proof of Stake algorithms that preceded it.
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Proof of Burn Explained

Proof of Burn Explained
While most blockchain systems either make use of a Proof of Work (PoW) or a Proof of Stake (PoS) consensus algorithm, the Proof of Burn (PoB) is being tested as a possible alternative to those.
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Proof of Authority Explained

Proof of Authority Explained
The cryptocurrency space has changed a lot since the first blockchain transaction on the Bitcoin network. Along with the well-known Proof of Work and Proof of Stake algorithms, other consensus mechanisms were proposed, with alternative methods for reaching consensus within a blockchain system.
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What Is a DoS Attack?

What Is a DoS Attack?
In short, a DoS attack (or Denial-of-Service attack) is a method used to disrupt legitimate users' access to a target network or web resource. Typically, this is accomplished by overloading the target (often a web server) with a massive amount of traffic - or by sending malicious requests that cause the target resource to malfunction or crash entirely.
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What Is a 51% Attack?

What Is a 51% Attack?
Before diving into the 51% attack, it is crucial to have a good understanding of mining and blockchain-based systems. One of the key strengths of Bitcoin and its underlying blockchain technology is the distributed nature of building and verifying data. The decentralized work of the nodes ensures that the protocol rules are being followed and that all network participants agree on the current state of the blockchain. This means that the majority of nodes need to regularly reach consensus in regards to the process of mining, to the version of the software being used, to the validity of transactions, and so forth.
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Delayed Proof of Work Explained

Delayed Proof of Work Explained
Delayed Proof of Work (dPoW) is a security mechanism designed by the Komodo project. It is basically a modified version of the Proof of Work (PoW) consensus algorithm that makes use of Bitcoin blockchain’s hashpower as a way to enhance network security. By using dPoW, Komodo developers are able to secure not only their own network but also any third-party chain that ends up joining the Komodo ecosystem in the future. In fact, dPoW can be implemented for any project that develops an independent blockchain using a UTXO model.
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What Is a Blockchain Consensus Algorithm?

What Is a Blockchain Consensus Algorithm?
A consensus algorithm is a mechanism that allows users or machines to coordinate in a distributed setting. It needs to ensure that all agents in the system can agree on a single source of truth, even if some agents fail. In other words, the system must be fault-tolerant (see also - Byzantine Fault Tolerance Explained). In a centralized setup, a single entity has power over the system. In most cases, they can make changes as they please – there isn’t some complex governance system for reaching consensus amongst many administrators.
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5 BSC Metaverse Projects You Should Know

5 BSC Metaverse Projects You Should Know
The metaverse is an online, immersive space where users can work, play, and socialize in a 3D environment. The metaverse is still developing, but blockchain technology already plays a significant role. BNB Smart Chain (BSC) is the home to many metaverse projects experimenting with play-to-earn blockchain games and community sandboxes.decentral.games lets users play and run their own casino through governance mechanisms. Cyber Dragon and Alien Worlds both provide an RPG-like experience where players have their own character, missions, and loot. TopGoal is also gaming-related but focuses on the collectability of Non-Fungible Tokens (NFTs) to represent sports stars like trading cards.
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A Beginner's Guide to Earning Passive Income With Crypto

A Beginner's Guide to Earning Passive Income With Crypto
Trading or investing in projects is one way to make money in the blockchain industry. However, that typically requires detailed research and a substantial investment of time – but it still won’t guarantee a reliable source of income. Even the best investors can experience prolonged periods of loss, and one of the ways to survive them is to have alternative sources of income.
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What Is Crypto Lending and How Does It Work?

What Is Crypto Lending and How Does It Work?
Crypto lending lets users borrow and lend cryptocurrencies for a fee or interest. You can instantly get a loan and start investing just by providing some collateral. This could be through a DeFi lending DApp or a cryptocurrency exchange. When your collateral falls below a certain value, you will need to top it up to the required level to avoid liquidation. When you return your loan plus a fee, your capital is unlocked.
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A Beginner's Guide to Decentralized Finance (DeFi)

A Beginner's Guide to Decentralized Finance (DeFi)
DeFi lets users access crypto financial services with just no more than a wallet with some crypto. A range of DApps facilitates lending, liquidity provision, swaps, staking, and more across many blockchains. While Ethereum was DeFi's original home, most blockchains with smart contract capabilities now host DeFi DApps. Smart contracts are essential to the services DeFi offers, which include staking, investing, lending, harvesting, and more.
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5 NFT Projects You Should Know

5 NFT Projects You Should Know
The interest in NFTs has exploded. While many NFT projects had a small community of enthusiasts since their early existence, 2021 has brought forth a bit of an NFT bubble. Many thought DeFi would bring mainstream adoption to the crypto space. However, it seems like the value proposition of NFTs is much easier to grasp for people not involved with blockchain technology. As such, some NFT projects have even entered the mainstream. But which ones are they?
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Top 3 NFT Projects on Binance Smart Chain

Top 3 NFT Projects on Binance Smart Chain
The demand for non-fungible tokens (NFTs) keeps growing on Binance Smart Chain (BSC). The blockchain’s speed and low transaction fees make it very attractive for both users and developers. On BSC, Battle Pets, PancakeSwap, and BakerySwap have all pushed further the limits of what an NFT can do. Both Battle Pets and BakerySwap combine collectibles with Decentralized Finance (DeFi) staking for their tokens. PancakeSwap is also experimenting with NFTs that merge collectability, financial utility, and gamification.
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Top 7 NFT Use Cases

Top 7 NFT Use Cases
Massive interest in non-fungible tokens has led to a boom in crypto-collectibles and NFT art. These are two of the most prominent use cases in the DeFi ecosystem, but they aren’t the only applications. Scarcity and uniqueness make non-fungible tokens a good match for real-world assets, logistics, music royalties, and more. As NFTs mature, we can expect to see further adoption of more experimental use cases.
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What Are NFT Games and How Do They Work?

What Are NFT Games and How Do They Work?
NFTs are unique digital collectibles on the blockchain. This feature makes them suitable to use in games as representations as characters, consumables, and other tradeable items. NFT games have become popular in the Game-fi world as a way to earn income. You can sell your in-game NFTs to other collectors and players and even earn tokens with play-to-earn models.
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What Is the Metaverse?

What Is the Metaverse?
The metaverse is a concept of a persistent, online, 3D universe that combines multiple different virtual spaces. You can think of it as a future iteration of the internet. The metaverse will allow users to work, meet, game, and socialize together in these 3D spaces.
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What Are CryptoPunks?

What Are CryptoPunks?
CryptoPunks are collectible pieces of crypto art, represented by NFTs on the Ethereum blockchain. There are 10,000 small, 8-bit-style punks, all with unique features. As one of the first famous NFT projects, they inspired a lot of crypto artists and even the development of the ERC-721 token standard for digital collectibles. The project became more popular in 2021 after some CryptoPunks were sold for millions of dollars, making them some of the most expensive NFTs.
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What Is an Automated Market Maker (AMM)?

What Is an Automated Market Maker (AMM)?
You could think of an automated market maker as a robot that’s always willing to quote you a price between two assets. Some use a simple formula like Uniswap, while Curve, Balancer and others use more complicated ones.
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A Guide to Crypto Collectibles and Non-fungible Tokens (NFTs)

A Guide to Crypto Collectibles and Non-fungible Tokens (NFTs)
The creation of Bitcoin introduced the concept of trustless, digital scarcity. Before it, the cost of digitally copying something was next to nothing. With the advent of blockchain technology, programmable digital scarcity has become possible – letting us map the digital world to the real world. Non-fungible tokens (NFTs), often referred to as crypto collectibles, expand this idea. Unlike cryptocurrencies, where each token is equal, non-fungible tokens are unique and limited in quantity.
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Decentralized Autonomous Organizations (DAOs) Explained

Decentralized Autonomous Organizations (DAOs) Explained
Blockchains are already radically transforming our financial system. However, properties such as trustlessness and immutability aren’t only useful in monetary applications. Another potential candidate ripe for disruption by this technology is governance. Blockchains could enable entirely new types of organizations that can run autonomously without the need for coordination by a central entity. This article will give an introduction to what these organizations might look like.
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A Beginner's Introduction to Cryptoeconomics

A Beginner's Introduction to Cryptoeconomics
In simple terms, cryptoeconomics provides a way to coordinate the behavior of network participants by combining cryptography with economics. More specifically, cryptoeconomics is an area of computer science that attempts to solve participant coordination problems in digital ecosystems through cryptography and economic incentives.
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Pyramid and Ponzi Schemes

Pyramid and Ponzi Schemes
Most individuals that invest in Bitcoin – or that participate in Initial Coin Offering (ICO) events – are usually concerned about two things. First, the Return of Investment (ROI), which represents the profits they will eventually make from the initial investment. Then, there is a second concern, which is related to the amount of risk involved with the investment. When the risks are too high, investors are more likely to lose their initial investment (in parts or completely), which would result in a negative ROI.
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What is Public Key Cryptography?

What is Public Key Cryptography?
Public key cryptography (PKC), also known as asymmetric cryptography, is a framework that uses both a private and a public key, as opposed to the single key used in symmetric cryptography. The use of key pairs gives PKC a unique set of characteristics and capabilities that can be utilized to solve challenges inherent in other cryptographic techniques. This form of cryptography has become an important element of modern computer security, as well as a critical component of the growing cryptocurrency ecosystem.
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History of Cryptography

History of Cryptography
Cryptography, the science of writing codes and ciphers for secure communication, is one of the most important elements that goes into making modern cryptocurrencies and blockchains possible. The cryptographic techniques used today, however, are the result of an incredibly long history of development. Since ancient times, people have used cryptography to transmit information in a secure manner. Following is the fascinating history of cryptography that has led up to the advanced and sophisticated methods used for modern digital encryption.
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What Is Axie Infinity (AXS)?

What Is Axie Infinity (AXS)?
It’s 2021, and that means you can earn money by playing games and breeding virtual pets. An easy way to think of Axie Infinity is to imagine a blockchain game that combines Pokémon, CryptoKitties, and card game elements.
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Is Bitcoin a Store of Value?

When you think of a safe-haven asset, precious metals like gold or silver probably come to mind. They’re investments that individuals flock to as hedges against turmoil in traditional markets. The debate over whether Bitcoin follows in the footsteps of these assets rages on. In this article, we’ll look at some of the main arguments for and against Bitcoin being a store of value.
When you think of a safe-haven asset, precious metals like gold or silver probably come to mind. They’re investments that individuals flock to as hedges against turmoil in traditional markets. The debate over whether Bitcoin follows in the footsteps of these assets rages on. In this article, we’ll look at some of the main arguments for and against Bitcoin being a store of value.
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Приготовьтесь! Биткойн будут сливать, но это не точно

Приготовьтесь! Биткойн будут сливать, но это не точно
Только что в Twitter наткнулся на пост от Jacob Canfield, якобы есть инсайдерская информация, о том что Bitcoin планируют сливать, дабы выбить некоторых конкурентов, потом обратно откупить, подняв стоимость до $70к.
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What Is Tether (USDT)?

What Is Tether (USDT)?
Tether (USDT) is one of the most popular stablecoins out there. It was designed to hold a one-to-one value with the US dollar. The coin exists on many different blockchains and has experienced rising trading volumes and improved liquidity over the past few years.
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More about the Crypto Fans club

More about the Crypto Fans club
Now I will tell you what our club is, how it works and what advantages it has. A minimum of water, a maximum of specifics. The club is a kind of trust fund, which consists of a team of Asset Managers, on the one hand, who invest in the crypto market, and Investors, on the other. I will not describe in this article what cryptocurrency is, why it is growing, and what are its advantages, this topic is worthy of a separate article. You can google all this, or go to coinmarketcap.com and see how the value of a particular cryptocurrency has grown at least this year, and doubts about investing in cryptocurrency should disappear.
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