A guide to the world of cryptocurrency

Chase Anderson

More stories from Chase Anderson

December 15, 2022

Source: Creative Commons

Popular cryptocurrency manufacturers including Bitcoin, Litecoin and Etherum are dominating the newly developed crypto-market. The industry is skyrocketing as more and more individuals invest in the market, including teens.

In an age of quarantines and Covid-19, it is apparent that technology is becoming harder and harder to live without, especially for teens. Between constant Zoom classes and Canvas assignments, it can feel like our lives are becoming virtual themselves. However, a positive aspect of the online world is a digital currency being developed which could allow teens to make millions. The coinage in question? Cryptocurrency.

Erik Finman, a teenage boy who grew up in Post Falls Idaho, was deemed the world’s youngest Bitcoin millionaire after investing 1,000 dollars into the currency in 2011. According to an article called “This 20-year-old high school dropout bought $1,000 worth of bitcoin at the age of 12 — now he’s worth $4.5 million” on BusinessInsider.com, Finman invested in the Bitcoin market when he was just 12 years old, which has now earned him almost 4.5 million dollars.

Finman’s surge to success is a good example of why the cryptocurrency market could be life-changing for young adults and teens alike. If technology is your thing, cryptocurrency could be an easy way to make bank. However, for those of you who are not quite as tech savvy, here are the top five things you need to know if you ever plan on investing or joining the crypto market.

  1. According to an article titled “Cryptocurrency” on Investopedia.com, “a cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend.” Cryptography, the science of protecting and keeping information private, is what keeps your currency secure and protected from the prying eyes of online hackers.
  2. There are thousands of manufacturers of cryptocurrencies. Among these are companies like Bitcoin, Ethereum and Litecoin, which are increasingly popular and, more importantly, stable. When contemplating which company you’d like to buy a share from, it’s important to research the security, viability and stability of each option so you can be sure your money is safe and that you don’t have to worry about the manufacturer being sued the next day.
  3. Cryptocurrencies have no fundamental backing. Unlike the money in your wallet or purse that is managed by the government, cryptocurrencies are not affiliated with any central authority. This means investing in cryptocurrencies could be a real gamble if you aren’t careful. However, this also means that you can buy and sell almost anything with cryptocurrencies due to this absence of government (do with that information what you will).
  4. Cryptocurrencies can be extremely volatile. In the same way that stocks on the stock market ebb and flow based on the day or week, the amount that a single Bitcoin is worth can change within seconds. Individuals can buy shares of a single Bitcoin and then watch those shares grow tremendously or completely plummet. With this in mind, you shouldn’t buy any more cryptocurrency than you can afford to lose. 
  5. Cryptocurrencies can be used all over the world. Because of the online nature of digital currencies, there is no need to exchange the money based on the country you’re in. This makes online international transactions much easier. Another benefit of having a universal currency is that individuals in third world countries are able to own capital even though access to a bank may be an obstacle. “By adopting Bitcoin or another сryptocurrency as the primary money in their country they immediately have a currency that won’t be influenced by changes within their specific economy,” says the article “Can Bitcoin Drive the Economic Growth of Developing Countries?” on Marketlinks.org. “Because Bitcoin operates on a global platform it is only susceptible to global economic changes, and localized changes will have little to no impact on the currency’s overall value.”

So if you do decide to attempt a “get rich quick” scheme using digital money, please do remember who wrote this list when you become a millionaire in Bitcoin.