The crypto industry seems like a mysterious industry to a lot of people. Some terms are probably hard to grasp for them, the news about the industry might seem vague, the major players seem to communicate in technical terms, and in general, the sector feels somewhat chaotic. But anyone that has a good grasp of the industry knows that it’s an easy-to-navigate once you understand the major terms, facts, stats and news updates. This article highlights ten facts about the crypto industry that you should be conversant with if you want to be a player, a trader, a product owner or anything in the industry.
Cryptocurrency value is volatile: Similar to the stock market, the crypto market is a volatile one as there are often factors that affect the value of the coins. Sometimes the market is on a high rise and the value is in your favour, other times, the market is down, and you lose funds terribly. It’s a risky market and ultimately if you are not a huge risk taker, it’s best to avoid the market entirely.
The first product purchased with crypto was pizza: In 2020, a Florida man purchased two pizzas for about 10,000BTC ($40) at that time which in today’s value will be worth approximately $400million. This means that in only 12 years, the value of bitcoin has ultimately risen.
The total number of cryptocurrencies in circulation is about 9500: As of march 2022, about 9500 cryptocurrencies were in circulation. Creating cryptocurrency isn’t difficult hence why the number of coins is steadily on the rise. However, of these total numbers, only about 15-20 of the coins (87% of the total) rule the actual market with Bitcoin (BTC) being the highest of them all.
You lose your keys, you lose your coins: A crypto wallet is a digital wallet with public and private keys used to access it. If you lose your private key, your digital funds are likely to disappear. So basically, the safety of your wallet is hugely in your hands.
Bitcoin creator is anonymous: Who created bitcoin remains an anonymous concept. Although, several schools of thought credit one Satoshi Nakamoto as the creator of Bitcoin, the real originator remains anonymous. The paper that originally talked about the Bitcoin protocol was released on a cryptography mailing list and the author remains a mystery. Nobody knows if the inventors were a group of people or one person.
The total amount of bitcoins is limited: As of March 2022, the total estimate of circulating Bitcoins was about 19 million. At some point, it will become extremely difficult to mine more Bitcoins because of its limitations.
Ethereum usage goes beyond just coins: Beyond its usage as a coin, Ethereum can also be used for payment processing, executing smart contracts and supply chain management. In addition, some other coins are even built on the Ethereum network. The Ethereum fees are also referred to as gas fees. When using the Ethereum network for transactions, you will always be required to pay a gas fee which is often high or low depending on the transaction.
NFTs are not cryptocurrencies: An NFT (Non-fungible token) is a cryptographic asset on a blockchain that has unique identification codes and metadata to distinguish it from other NFTs. It is usually a unique token that can not be used as a medium of exchange and cannot be replicated.
One of the first crypto games is called Cryptokitties: Cryptokitties is not a cryptocurrency but a game where you breed digital cats and are a part of the NFT world. It was also built on the Ethereum network. The digital cats (kitties) are unique and can’t be replicated just like visual artworks. In 2018, the most expensive crypto kitty was sold for 600ETH, a crypto kitty dragon. 600 ETH was worth approximately $170,000 in 2018 and will be about $2 million today.
Cryptocurrency is not legal everywhere in the world: Some countries ban the usage of cryptocurrency either as a means of payment or the exchange itself. In Nigeria, cryptocurrency exchanges are banned. In China, the country which accounts for the highest percentage of crypto mining, financial institutions are banned from providing services related to crypto transactions. In Turkey, cryptocurrency payments are banned.