“Blockchain” and “cryptocurrency” are among some of the most-searched terms in Google recently thanks to news about BitCoin’s price surging. Most people don’t have a clue about what these terms are (hence the searches) but they do know that cryptocurrencies are a form of investment like forex. Unfortunately, while the principle is similar because cryptocurrencies are a traded form of currency, the way BitCoin works is completely different to any kind of currency pair that you can find.
To help you out, we’re going to talk about blockchains and cryptocurrencies to help you achieve a better understanding of what it’s all about.
Defining Blockchains and Cryptocurrencies
Let’s start with the basics and explain what these two terms mean.
- Blockchains are essentially digital edgers where transactions in cryptocurrencies are recorded. It’s a form of technology that enables cryptocurrencies to exist in the first place. Think of it as a gigantic database where every single transaction is kept in chronological order. You don’t need to understand how it works if you’re interested in BitCoin or another cryptocurrency, but it’s nice to get a general overview of what it implies.
- Cryptocurrencies are digital currencies that utilize encryption techniques to safely regulate their value and also validate transfers. These cryptocurrencies are independent of banks and they’re generated digitally. Two good examples of popular cryptocurrencies are BitCoin and Ethereum. There are many different advantages to both the currencies and their values fluctuate drastically over the years. Ethereum, for instance, was worth $10 per unit in 2017. Currently, they are quoted at around $800. Ripple is another popular cryptocurrency that has recently grown in popularity.
Now that you have a basic understanding of blockchains and cryptocurrencies, let’s see what the fuss is all about and why it’s making waves in the news.
Advantages of Cryptocurrencies
So why use cryptocurrencies over regular currency? Here are just a couple of the most popular advantages:
- Lower transaction fees. Unlike other currencies, there are lower fees involved when making payments with cryptocurrencies.
- Immediate transactions. Transactions are immediately resolved when using cryptocurrencies unless a third-party is involved.
- No risk of fraud. Cryptocurrencies are completely digital and, unlike paper money, cannot be counterfeited.
- No risk of identity theft. Since your personal information isn’t handed out when making payments with cryptocurrencies (unlike credit and debit cards) you’re not at risk of identity theft.
- Decentralized currencies. Cryptocurrencies are decentralized which means that there isn’t a single source or authority that governs it.
- Universal use. Virtually every country can adopt cryptocurrencies because they are not bound by various rates like exchange rates. They can be universally used as long as a cash system supports it.
Industries That Use Cryptocurrencies
As you might expect, cryptocurrencies are slowly becoming more mainstream and being used in all kinds of different industries. One of the first industries to adopt the use of cryptocurrency is the technology industry. Early uses of cryptocurrencies involved being able to purchase goods on the internet or trade digital items and pay for services. There are now many uses for cryptocurrency on the web, such as being able to make donations with it or accept crowdfunding payment.
Nowadays, the use of cryptocurrency is widespread and marketers are all over it, using social media, blogs, lead generation pages to spread the word. So which industries are using it right now? Some car dealerships offer vehicles for BitCoins and there are even some realtors that accept BitCoin payments. With the use of BitCoin expanding so rapidly, don’t be surprised to see your local coffee shop offering goods for cryptocurrency in a few years or even months.
Here’s some information on two of the most popular cryptocurrencies: Bitcoin and Etherum and why you should take notice of Ripple…
Bitcoin is the world’s first and top cryptocurrency that had gained popularity and a huge increase in value. It was created in 2009 by a person under the alias Satoshi Nakamoto. Its main feature is that transactions can be made without the middle man – meaning that no banks are involved!
You can use Bitcoin to book hotels, pay for Xbox games, and buy furniture. But most of its hype has recently come from people trading it. As of now, its price is $8207.77 whose price used to be past the $10,000 mark in 2017.
Another reason why Bitcoin is amazing is because it can be mined. A person (company or group) can mine Bitcoin through record-keeping and advanced math. This is how it works, when someone sends Bitcoin to someone else, the network records it and then records the other transactions and places them on a “block.”
Miners use powerful hardware and specialized software to convert the blocks into code sequences known as “hash.” Once a new has is made, the miners who found it are awarded in Bitcoin. As of now, miners can obtain 12.5 Bitcoins which worth around $225,000 at this time.
Bitcoin is ranked first because it started new concepts such as “decentralization” and “peer to peer trading.” We would see other cryptocurrencies, such as Ethereum use this concept to help users make apps and trade their currencies at a rate that’s faster than Bitcoin.
Speaking of Ethereum…
Ranked second on our list is Ethereum. Like Bitcoin, Ethereum is running on a public blockchain network. While Bitcoin and Ethereum are completely different in technology, their largest distinction is their difference in capability and purpose.
Ethereum’s blockchain is used to run program code for any decentralized application. Instead of miners obtaining Bitcoin, they receive Ether, the main currency that fuels the network.
Ethereum also has smart contracts, which acts like a self-ran computer program that automatically execute once specific guidelines are met. Since they are running on the blockchain, the code can run without downtime, third party interference, and without censorship.
What makes Ethereum a top cryptocurrency is its ability to let startups create decentralized apps. They can receive funding from other Ether owners to help power their app without the long process of seeking a venture capitalist to invest in them. Ethereum is now priced at $857.70, which we can only expect it to grow due to the development apps on its platform.
Ripple is the third top cryptocurrency on our list. Like other cryptos, Ripple has a distributed ledger network that allows users to help each other validate transactions. This makes it more efficient and faster than traditional centralized authorities.
What stands Ripple apart is its transaction speed. On average, Bitcoin takes about 10 minutes to complete a transaction. Ripple can accomplish this task in under 60 seconds. This makes Ripple more appealing to a mass market, who needs a faster network to help them pay for goods.
Ripple is currently developed by Ripple Labs. As of now, they have of 100 billion XRP available, as its unable to be mined. Ripple’s current price is now $.73, making it the cheapest option on this list.
While other cryptos are used for separating financial transactions from centralized banking, Ripple seems to do the opposite.
To conclude, we believe that each of these cryptocurrencies provides a lot of value into today’s current market. Not only are they bringing in new financial options for users, but their combined technology helps make transactions safer and faster. Ultimately, it will be interesting to see how these cryptocurrencies will act as blockchain technology continues to evolve.
Disclaimer: This post was made to educate users on cryptocurrency. Don’t take it as investment advice.
Financing A Business With A Home Equity Loan
Finding funds for a business is no easy task. Qualifying for a business loan is not guaranteed; therefore many companies leverage their owners’ assets like the family home to raise the funds they require in their enterprise.
There are many ways to use personally guaranteed funds too and one option is what’s called a home equity loan or home equity line of credit, These loans can also be ideal for debt consolidation of say high-interest borrowing like credit cards, personal and short term loans but in this blog post we’re focusing on how these loans work for businesses.
There are many more obstacles or hoops to jump through when seeking an actual business loan and often it’s the financial statements of the business that fail to pass the lending criteria due to the startup phase requiring more investment and not showing a profit.
Entrepreneurs starting out, are therefore renown for sourcing investment from wherever they can get it. The credit card has been the go-to source for funds, but the interest rates are very high, so it’s not a long term borrowing solution for a business.
Before long, the owner is seeking other sources to keep the business afloat or to grow it. They may take out personal loans but before long their requirements exceed what they borrow without additional security so this is where many use their home.
As a business owner, it may make perfect sense to use a home equity line of credit to draw down funds for the business and then repay them when in lump sums and repeat as and when required. So what is a HELOC?
This type of loan allows you to have an open line of credit on the equity you have in your property.
HELOC’s has longer repayment periods that can be 10 – 20 years much like a usual mortgage and as the property owner you can borrow up to 85% of the home’s value minus what you may owe it. For example, if your home is valued at $750,000 and you have a mortgage of $250,000 on it already. Your line of credit may be as much as $425,000.
HELOC rates are higher than your standard mortgage rate, so it’s very much ‘caveat emptor’ or buyer beware, get professional expert advice from your accountant, financial advisor and maybe also your lawyer. Remember all loan agreements are legal documents, and they have terms and conditions that the borrower must comply.
There are many other ways to fund your business, including angel investors, offering shareholdings, so while using the equity in your home is an option it may not be the best way forward as the risk is your business cannot pay back what it’s borrowed, and you are personally liable to repay it or lose it.
Remember it is your equity and if your business borrows too much of it and can not repay it, and the lender calls in the loan it could be that you are forced to sell your home. It’s a dreary thought, but it’s better to know the pros and cons when borrowing money for any venture.
Young Money: How To Fund A Startup
Have you got a great idea for a business and now you want to make it happen? You’re not alone. While every business with the idea, commercialising it is a whole new site of skills. Getting a startup business up and running is a challenge for anyone who has not done it before.
Entrepreneurs don’t usually have the ideas, i.e. they’re not the creative talent. They’re the people, the ideas creators turn to, when they want to see how far they can take the idea and turn it into a viable business.
The start up phase of any business involves a lot of working hard, but not exclusively, it also requires investment. Seed money can come from various sources. Without the money, to get started and provide ongoing investment as the business shows promise, your venture may take too long to mature and a competitor takes your place in the eye of the consumer. So where can the investment come from?
There are a lot of different funding options available for small businesses, and they all offer their benefits. You can find some examples of the most popular methods below, along with some additional information to help you choose which route might be best for you.
You will need to invest in yourself, i.e. put some of your own money in. If you have not got savings, consider other options, like your home loan. This is a hugely popular option for start ups that fail to get funding from other sources. Caveat Emptor: Always seek professional advice from your accountant, lawyer etc before taking on debt.
So if you have money saved up or can get a loan from a bank, funding your business will be a fast process. As aforementioned, there will be a personal risk here, but you won’t have to prove to anyone that your business will work, making it great for those who can’t get further than a concept without some capital.
Some banks and governments will offer loans to new businesses. In most cases, you will have to have existing cash flow to make this work, limiting the successful startups will have with it.
If you can convince an investor with the money to back your idea, you won’t have to look at other types of funding for business, as you will have both money and support. This isn’t always easy to find, and you will have to prove that your idea is worth their time, making it hard for those with nothing but a concept.
Personal Risk vs. Sacrificing Freedom
The choice you make when you’re choosing how your company will be funded largely rests on what is more important to you.
If you are willing to take on personal risk, using your own money can be a great way to go, as it will give you all the freedom you need to build the business you’ve been dreaming about.
For those who would rather keep their money safe, making a couple of compromises along the way can be a small price to pay for an investor or venture capital. This is a very personal decision to make.
Why Isn’t The Bank An Option?
A lot of startups find disappointment when they approach a bank for a loan to get themselves off the ground.
Unfortunately, history has shown that being too willing to offer new businesses money can result in heavy losses, and banks have learned for their mistakes. Before you can convince a company like this to support your venture, you will need to prove that it can make enough to pay it back, and most startups just don’t have the income.
Choosing the funding option which you use for your startup has always been a challenge. It’s becoming more common to find businesses which cost nearly nothing to get started, opening the doors to another idea for you to consider.
Best Cryptocurrency to Buy – Which Is Best?
A lot of people might say that cryptocurrency’s big moment has ended. After the sharp rise and precipitous fall of bitcoin, many strait laced investors soured on the idea of crypto investment. Crypto’s 15 minutes of fame were over, the thinking was, and it was time to move your money back to safer, and more standard commodities.
This, however, is just not true. Cryptocurrency continues to be a sound investment, if you know the best cryptocurrency to invest in. We’ve compiled a list of four great picks below.
Ethereum is sometimes thought of as bitcoin’s chief rival, which perhaps makes it the second-most famous cryptocurrency. Ethereum is also commonly thought of as an expansion of blockchain technology beyond bitcoin. It is traded as a cryptocurrency, but it also has value as a decentralized computing platform.
Ethereum includes a programming language that runs on blockchain. So, it is used by developers to create apps, including health and security infrastructure, music licensing services, and even anonymous browsers. Ownership of an Ethereum token is recorded on the shared blockchain ledger, as it would be on any cryptocurrency.
However, Ethereum expands this practice to record the ownership of copyrights, music, documents, financial instruments: anything imaginable. By purchasing Ethereum, you are investing in this network, rather than the security as such. For this reason, Ethereum is an excellent investment and one that the savvy investor should be scoping out.
For fame and notoriety among the cryptocurrencies, none can match bitcoin, the original cryptocurrency in many people’s minds. Now more than a decade old (the mysterious Satoshi Nakamoto published the bitcoin white paper in 2008), bitcoin has had its share of ups and downs.
For the savvy investor, though, bitcoin can still be a sound investment. After the massive — and massively famous — December 2017 peak, the price of bitcoin has held steady between $3,000 and $6,000 per coin. As bitcoin matures as a security, it is looking more and more like a place to park your money, rather than the white-hot investment it was two years ago. This is not a downside, because investors need (and will take) both options.
It started as a joke — a play on the classic “doge” meme. But since its inception in 2013, Dogecoin has grown to a market cap of over $312 million dollars in April 2019, with values soaring as high as $2 billion in January of 2018. Dogecoin’s value fluctuations will be familiar to anybody who has traded in penny stocks. It maintains a steady mean value, punctuated by regular spikes in its price.
The trick, as it were, is to buy it just after a spike in its price, and to sell it during the next spike. While Dogecoins are not a strong long-term investment, they can be a decent swing investment if you have the time and energy to monitor them. The origins may be silly, but the money is very real.
Litecoin is a cryptocurrency specifically developed for zero-cost payments. Litecoin was developed to have a faster transaction confirmation than Bitcoin. This emphasis on fast, secure transactions has made Litecoin one of the most popular coins with businesses interested in security.
For this reason, the value of a single Litecoin has risen from $30 to $78 in the past six months, well below the mean value. This is the perfect opportunity for an investor to swoop in. As security becomes increasingly important to businesses across the board, Litecoin begins to look like a better opportunity than ever.
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