1. Bitcoin is just one type of cryptoasset
A common theme in the cryptocurrency world is that people new to the space often think crypto is synonymous with Bitcoin. While these people aren’t necessarily wrong, seeing as Bitcoin is one example of a cryptoasset, what they might not realize is that there are thousands of others currently being offered. Some of the most popular cryptoassets include Etheruem, Litecoin, and stablecoins. Each one has a different use case and story behind its creation.
The reason that Bitcoin has become such a household name is in large part because of the 2017 bull run, when Bitcoin prices touched nearly $20,000 per Bitcoin. The other reason Bitcoin has become so ubiquitous in the crypto community is because it was the first cryptoasset, but we’ll touch on Bitcoin’s creation a little later in this article.
2. Cryptoassets are built with blockchain technology
People in the crypto space love to throw around the buzzword: blockchain. This can be confusing because blockchain, crypto, and Bitcoin while all interconnected, are distinctly different technologies. Bitcoin is a cryptocurrency, and all cryptoassets operate using blockchain technology. So when someone references blockchain, they are talking about the technology that cryptoassets are built with. This is an important distinction because blockchain technology can exist without crypto, but crypto (i.e. Bitcoin) can’t exist without blockchain technology. So the best way to break down how cryptocurrency works is as follows:
- Blockchain is a technology
- Cryptocurrencies are coins or tokens created using blockchain technology
- Bitcoin is one of these digital coins that we call a cryptoasset
3. Cryptoassets have been around for over 10 years
Bitcoin was officially launched in 2009 by an unknown founder who goes by the pseudonym Satoshi Nakamoto. That makes Bitcoin over 10 years old. To put that in perspective, Bitcoin was created before Instagram. In technology time, that’s pretty old.
Prior to the network launch in 2009, the Bitcoin whitepaper was published on 31 October, 2008. The whitepaper outlines the purpose and function of Bitcoin and how it operates from a technical perspective. This paved the way for where the crypto space is today.
4. Cryptoassets are becoming popular globally
Due to local currency volatility and hyperinflation in countries around the world, cryptoassets have become a financial safe haven for millions of people. This is possible because cryptoassets aren’t tied to local economies, but rather the global economy. For this reason, crypto has become particularly popular in countries like Argentina, Venezuela, Ukraine, among others. Even if it may be volatile by U.S. standards, cryptocurrency exchange rates in countries with hyperinflation are often more appealing and offer a better store of value than local currencies. Outside of hyperinflation, many high-net-worth individuals around the world view cryptoassets as a way to invest in the future of blockchain technology, and some people have even gone as far as to say that owning cryptoassets is like owning a part of the next internet. In any case, it’s hard to deny that cryptocurrencies are a growing global phenomenon with far-reaching potential.
5. Major corporations are getting involved in cryptoassets
Before 2017, few people took cryptoassets seriously and many associated them with nefarious activities. Nowadays, the crypto industry is rapidly evolving and some people are worried about it being too late to get involved in crypto. There are already multiple futures contracts for Bitcoin that can be traded, and major corporations don’t want to miss out on the potential of cryptocurrency. Recently, Facebook announced they will be launching their own cryptoasset in the near future called Libra. Financial companies like Fidelity and TD Ameritrade are also getting in on the action with crypto trading platforms. Within a span of just a few years, crypto went from flying below most people’s radar to being the next big thing that investors don’t want to miss out on.
What’s next for cryptoassets?
While no one can predict what the future of cryptoassets will be, there have never been more positive signs that crypto will continue to grow in popularity and utility. That’s why companies like BlockFi were founded.
At BlockFi, we aim to provide wealth management services for crypto investors. You can earn interest on your crypto by simply creating a BlockFi Interest Account (BIA). Moreover, you can get paid interest in a different currency than the cryptoasset you deposit by using our Interest Payment Flex feature. This allows you to diversify your crypto portfolio without having to buy or trade additional cryptocurrency.
Looking to make a purchase that requires USD? At BlockFi, we offer crypto backed loans. This means you don’t need to sell your Bitcoin position to be able to make important life purchases, like buying a home. Ultimately, our goal at BlockFi is to provide products that help you grow your wealth by doing more with your crypto.
As always, if you have any questions or comments you can reach out to our support team at email@example.com or +1(646) 779-9688.
– The BlockFi Team