This might seem like an odd question and a weird way to look at things, but you would be surprised at just how many people hold large investments in cryptocurrencies and don’t fully understand them. We want to clear the air a bit, especially after the turbulent end of week and weekend following the Bitcoin Cash hard fork. Cryptos are more than just digital currencies that are bought in hopes of getting rich – they all have their own unique purpose, just like you and I.
More Than an Investment
Hands up if you bought cryptos with the goal of getting rich quick? Odds are that is many of you, but that’s not the point of cryptos at all. Sure, it might be a by-product of holding cryptos over a number of years, but they are actually tokens – tokens are used to operate special devices or access certain content.
Think of cryptocurrencies like casino chips. You change your money into casino chips which you then use to play games in a casino – cryptos are exactly the same. You exchange your fiat into crypto in order to play with the desired blockchain network. Cryptocurrency exchanges are simply a cashier’s desk where you get your hands on these digital casino chips.
Why Does the Price Rise and Fall?
That’s actually really simple, the price of cryptocurrencies rises and fall based on the performance of the blockchain network and its integrity. The more people using the network, the more demand there is for that network’s cryptocurrency, so there is a higher price. The less people who believe in the network and its stability, the lower the token price will be.
Let’s take Stellar for example, in the past few months organizations around the world have been signing deals to work with the network. This means the trust in the network is growing and more Stellar tokens are being used to interact with the network – sending payments to one another. This in turn bumps up the price of Stellar’s token (XLM) due to simple supply and demand principles. This is the reason why Stellar has become a top five cryptocurrency and edged out EOS.
Cryptos Power Blockchain Technology
Cryptocurrencies are used as a form of payment on many blockchains to cover fees or given as rewards for interacting with the blockchain in processes such as mining. This highlights the fact that cryptocurrencies are more than just investments, but are in fact a unique key that opens the door to a powerful blockchain. Bitcoin is a payment network, and that’s the sole purpose of the Bitcoin network and its blockchain. Miners are rewarded with Bitcoins for mining new blocks that make it possible for cryptos to be transferred between wallets who then spend it using the same network. The FunFair network is a casino blockchain that gives token holders the ability to play games as if they are at the casino. Each cryptocurrency has its own individual use and can be used for so much more than just holding.
So, now you know a bit about the potential behind cryptos. Go out there and use your crypto to its full potential rather than letting it collect dust in a wallet. Cryptos were designed to be used, and until people start using cryptos for the purposes they were designed, mass adoption will never happen. Be a part of the future and start using cryptos today!