In the traditional banking system, users do not have total control of the money they have. A central entity is the one that controls the amount of money that is printed. This causes, in some occasions, that a currency lose value, by the emission of inorganic money by government decision. Similarly, users must cancel a series of commissions and wait certain periods of time to move the money they have in their accounts. In addition, they must justify each of their movements, in order to comply with the specific regulations required by the country where they are operating.
With cryptocurrencies, things do not work this way. By storing their value in the form of cryptoactives, users can access their funds at any time and see the amount of cryptocurrencies they have in their accounts. In addition, from any part of the world, cryptocurrencies such as Bitcoin can be transferred, without there being a limit of minimum or maximum amounts to be sent from one user to another. Only one tariff must be paid to the miners, who are one of the fundamental pillars in cryptoeconomics. Likewise, there is no regulation on the use of Bitcoin, since there is no centralized entity that controls or determines what can be acquired or paid with Bitcoin (except when exchange houses are used between cryptocurrencies and fiduciary money). Choosing cryptocurrencies means becoming your own bank.
- FACE VOLATILITY WITH PATIENCE IF YOU ARE HOLDER, WITH ASTUCIA IF YOU ARE TRADER.
Something that we must take into account when choosing to become our own bank, is that the majority of cryptocurrencies present volatility to a greater or lesser extent.
Volatility is the variability that an asset presents in its profitability in a given period of time. That is, the value of cryptocurrencies such as bitcoin, expressed in fiduciary currency such as the dollar, varies over time. This is quite appreciated by those traders such as scalpers or even swing traders, who are dedicated to buying and selling cryptoactives, in order to obtain profits from the price variations.
In fact, a study published by Deutsche Bank specialists in January of this year, indicates that the high volatility of cryptoactives is the characteristic that makes some investors prefer this market, when traditional stock market shares show very little fluctuation in its value.
However, if you decide to become a holder and keep your cryptocurrency in your wallet until its price increases and go to the moon, an expression used in the crypto to indicate extraordinary increases in the price of a cryptoactive, in that case you must arm yourself patience, because this could take a while to happen. Even, the value of an asset could go down considerably. Those who knew Bitcoin just in December of 2017 and invested in the cryptocurrency when it was at 20 thousand dollars, they know very well what we are talking about: BTC yesterday brushed the 7000 dollars and the crypto market lost about 12,000 million dollars in 24 hours .
- MAINTENANCE OF THE NETWORK
As we have mentioned, the work of miners and nodes are fundamental pillars of cryptoeconomics. By downloading a complete node, the responsibility for the maintenance of a network rests with each one.
The distributed accounting technology receives this name precisely because the data of the blockchain where the cryptocurrencies are written are stored in identical copies in all the nodes of the network that, in the case of popular cryptocurrencies such as Bitcoin or Ethereum, are distributed in different parts. of the world.
This distribution is also the one that guarantees the transparency and inability to network. Thanks to the transaction verification system, the miners certify the transactions after all the records have been checked to verify that those coins have not been spent beforehand and thus avoid double spending. The miners are also in charge of creating the new coins, adding new blocks to the chain. In short, the miners are responsible for maintaining the safety of the network.
- VERIFY THAT THE PROJECTS ARE LEGITIMATE
Some people who have started to be their own bank, also decide to support cryptoactives that do not have the wide recognition of projects such as Bitcoin, Ethereum, Zcash, Monero, among others. In fact, some of these cryptoactives may come from ICOs, and should be treated with caution due to the large number of scams that have been committed thanks to the ICO. For this reason, it is essential to verify the legitimacy of the projects that support them.
To do this, it is advisable to check the project's white paper, and that the things embodied there are coherent. Social networks like Reddit and BitcoinTalk are also useful to know what the community thinks
To do this, it is advisable to check the project's white paper, and that the things embodied there are coherent. Social networks like Reddit and BitcoinTalk are also useful to know what the bitcoiner community thinks about it. In the same way you can do a quick research on the profiles of its creators and see if the cryptoactive quotes in any exchange house.
- SAFEGUARD YOUR PRIVATE KEYS AS IF YOUR LIFE DEPENDS ON IT
The private key is the equivalent, in the crypto, to what would be the combination of a vault or safe for the rest of assets. With it, and the recovery words, you get access to the wallet and it can be restored if you change or lose access to the device where it was hosted. It also allows the transfer of coins from one address to another. The private key consists of a randomly created alphanumeric code, while the recovery words, a group of random words that are generated at the time a cryptocurrency portfolio is created. With a seed you can create different private keys.
The responsibility to protect them is something that afflicts many bitcoiners. Keeping them on paper is fine, unless you want to risk your funds being stolen by someone who has access to your house or the place where you store them, or that a natural disaster destroys them and your cryptocurrencies are frozen forever. Even some experts have determined that using cold wallets does not guarantee that private keys are completely safe, since hackers could steal them even without an Internet connection.
Some have thought of quite unusual solutions to protect them. For example, in the United States, there is a professional hypnotist who claims to help his clients to recover the keys of their portfolios after three sessions of hypnosis. On the other hand, there are users who have chosen to write their keys in metal, in order to resist the passage of time and possible accidents.
A portfolio like Xapo offers its users a physical vault where to store their bitcoins and assumes the responsibility of protecting them. IBM, on the other hand, applied for a patent to create a cryptocurrency portfolio insertable into the skin. A very curious place to keep the funds safe.
- BELIEVE IN THE CODE AND SPREAD YOUR WORD
Finally, a bitcoiner that appreciates being so called, is not only who enjoys the payment method offered by the cryptoactive, but also someone who agrees with the ideals that Bitcoin brought with them.
Thus, although the cryptoactives have conquered very important spaces over time, there is still a long way to go before decentralization can defeat the banks. In this sense, users who attest to the advantages of the use of cryptoactives, are the main responsible for spreading this knowledge among those who still do not know them. After all, it is the users who determine the value and survival of a cryptocurrency.