Cryptocurrency is a fairly new interest of mine. I had heard of Bitcoin when it was only a few dollars, but didn’t understand it enough to see its value or potential. I missed the initial Bitcoin bubble, but what that price rollercoaster did for digital currencies was huge. It showed the world that the future of money is changing.
Bitcoin and other digital payment systems are still in their infancy, so it’s hard to tell what will happen in the future. If I had to take a stab in the dark based on the info I have now, I’d say Ripple will be adopted by banks for their cross border payments and Bitcoin will remain the digital cash on the street equivalent.
There are so many other alternatives out there, and many of them bring their own interesting and potential uses to the table. For example, Namecoin 1 includes censor-resistant domain name registration of the .bit TLD, Dash 2 adds additional privacy to its transactions, and Ripple 3 with its XRP bridge currency is used for protection against denial of service attacks.
I wish I could afford to have a chunk of change to invest in dozens of different cryptocurrencies because you can never be sure which might be the next big thing. At this point, I’ll just have to pick a few of my favorites to use and hold for now. If you’re skilled at trading or finding arbitrage opportunities among the different exchanges, you’ll probably find ample opportunities in crypto.
I’m not particularly adept at either, so what I look for is something I see as being in demand for a long time. Not every alt coin will last, but if there’s a decent market cap, acceptable daily volume, dedicated devs, and a large community using and supporting it, I think the coin has a shot.
The buy and hold approach isn’t very sexy, but you can still earn money through mining. I’ll use one example of a lesser known favorite called OKCash. I own some OKCash, and in the first year the staking rewards (proof of stake mining) is 69%. Year two staking rewards are 20%. This is like finding a dividend paying stock on steroids.
Of course, you always have to carry some risk, the most important is wondering if this (or any) alt coin is going to be around in a year or two, and if so, at what price. But if you’ve been able to check off all of the aforementioned traits, I’d say the potential reward is most definitely worth the risk.
You also have to keep dreaming too. One of the digital currencies you buy/mine might just end up being the next big thing and create a whole new bunch of cryptocurrency millionaires. You won’t see me turning blue from holding my breath, but it’s still fun to dream.