Regarded as the digital money for the future, cryptocurrency production first began in 2008 after the creation of Bitcoin by Satoshi Nakamoto in late 2008. There are about 828 cryptocurrencies in the cryptocurrency market according to Bitcoin dominates 47.8 percentage of Market Capitalization in this market followed by Ethereum which dominates 22% while Ripple is third at 7.7%

Mining crypto currencies

The cryptocurrency digital model was created to prevent users from spending digital monetary amounts twice; cryptocurrency technology prevents this through record keeping.

To manage the creation, movement, and storage of crypto currencies, one does not need a central server located on a central bank or financial institution; this is where miners come in handy. Miners validate transactions moving through the network to receive new crypto currencies as compensation.

Transaction properties of crypto currencies

1. When cryptocurrencies are sent, such a transaction cannot be reversed. If you send such currencies to a scammer, no one will be there to help you reverse the transaction. If a hacker steals them from your wallet, you will never get them back.

2. Users can enjoy sending and receiving cryptocurrencies anonymously with no record keeping. Government censored website Wikileaks accepts Bitcoins as donations.

Debit card companies also bar their customers from using their cards when depositing into betting sites.

3. Owners lose their coins when they lose their cryptocurrency wallets. In 2012, a U.K man named James Howells threw away a hard drive that contained a wallet containing 7,500 bitcoins. The coins are now worth 19 million U.S dollars.

His hard disk ended up in a garbage site the size of a football field after throwing it in a trash can. He never considered looking for the hard disk from the garbage site because of the costs of excavation; he suggested that he would need 15 people to help him dig up the who site to search for the hard disk. He lost hope due to the costs he will incur considering that he now has kids to take care of and that he might never recover his hard drive which contained a Bitcoin wallet full of valuable Bitcoins.

Cryptocurrency prices

The supply of crypto currencies is limited, for example, the production of Bitcoin might stop in or around the year 2140. Thus if a certain amount of Bitcoins has been created, the production of Bitcoins will end. Prices of the coins might rise when their output ends. Supply caps is also making mining harder every day. Bitcoin mining is no longer feasible on a single P.C. Most miners complain of high electricity costs when mining the coins. Bitcoin has the highest price of all cryptocurrencies. Its price is currently at about $2,526 followed by Byteball whose price is $468. Cryptocurrencies such as ReddCoin costs as little as $0.001.

Investing in crypto currencies

The future price of cryptocurrencies can be speculated for profit purposes.

A rise in the price of these currencies in the past does not guaranty a rise in their price in the future. Supply limitations might, however, help prices go up. Investors should, however, approach these currencies with caution as the central bank of Estonia called them a pyramid scheme while Warren Buffett has warned investors against investing in them.