10 facts about cryptocurrency you should know
The world of cryptocurrencies is constantly evolving, and the world is paying attention. Veteran or intending crypto investors are always on the lookout for important facts about crypto.
Cryptocurrencies were in the headlines in 2021, which led to a growing interest in learning how to buy cryptocurrencies and figuring out easy ways to buy and sell bitcoin in Nigeria. It’s no surprise that some investors are hoping to learn more about how digital assets work. But with cryptocurrencies, sometimes the truth can be stranger than fiction.
In this article, we’ll outline 10 important facts about cryptocurrencies. But first, a disclaimer: no list can possibly be exhaustive.
1. The first commercial bitcoin transaction was for pizza
A man in Florida paid 10,000 bitcoins for two Papa John’s pizzas on May 22, 2010. This was the first Bitcoin payment for goods, and it was worth around $40 at the time. This is widely acknowledged as the first commercial bitcoin transaction. You’d be a bitcoin millionaire if you had that many bitcoins in September 2022. 10,000 bitcoins are worth more than $190 million in the market.
2. There are more than 18,000 cryptocurrencies in existence
There are over 18,000 digital currencies in circulation as of October 2022. Although not all of them are available on exchanges, some require their own wallets. This includes many altcoins such as USDT, XRP (XRP), Solana (SOL), Binance USD (BUSD), and more.
There are so many coins and tokens available because it is relatively simple to create and distribute a new cryptocurrency. However, as of October 2022, the top 20 virtual currencies account for approximately 87% of the cryptocurrency market cap.
3. The total amount of bitcoins is limited
An interesting bitcoin fact is that the protocol for the bitcoin network was designed with a limit of 21 million coins in mind. As a result, cryptocurrency miners will eventually be unable to generate any new bitcoins.
Currently, there are 19.15 million bitcoins in circulation. This leaves a few million bitcoin to be mined, which is one of the reasons mining is still a popular activity.
4. Nigeria is Africa’s largest crypto market
Crypto adoption in Nigeria is increasing at an exponential rate. Due to the constant depreciation of the Naira, the country now has more than 50% monthly active adult crypto traders, as many citizens prefer to store their money in digital currencies rather than fiat cash. Even going as far as to purchase airtime from crypto wallets.
Despite the Nigerian government’s ban on cryptocurrencies in 2021, many Nigerians continue to trade them. According to Merchant Machines data, Nigeria will be at the forefront of global crypto adoption by 2030.
5. Ethereum fees are referred to as gas
When using the Ethereum blockchain to complete transactions, you’re required to pay for gas. On the Ethereum network, gas represents the computational effort used to buy and sell Ethereum in Nigeria.
Using the network for apps or transactions, even if it’s converting another coin to ether, means you need to pay for gas. Depending on the transaction and traffic on the blockchain, gas fees can feel quite high in some cases.
6. NFTs aren’t currencies
Even though they grew in popularity in 2021 and are considered digital assets, NFTs aren’t cryptocurrencies. They’re tokens that are not used as a medium of exchange. And NFTs can’t be divided or replicated.
NFTs can be used as alternative investments similar to artwork or collectibles. In fact, that’s how some people see them — digital collectibles and artwork that may potentially grow in value.
7. Dogecoin started as a joke
One of the hottest cryptocurrencies in 2021 was Dogecoin (DOGE), as its market capitalization grew, in part due to support from Elon Musk. It recently replaced the Cardano ADA as the 6th largest crypto in the world. However, this cryptocurrency started out as a joke.
The idea was that there were so many coins out there, just being introduced. So the creators of dogecoin invented the cryptocurrency around the image of the surprised-looking Shiba Inu dog. This was a popular meme in 2013 when dogecoin was introduced.
8. The creator (or creators) of bitcoin remains anonymous
Bitcoin is widely known to be created by Satoshi Nakamoto, a pseudonym that is not connected to a real person. The author who distributed the protocol paper via a cryptography mailing list remains unknown. There is much speculation about Satoshi Nakamoto’s identity, but no one knows who he is. Nobody knows if they’re a single person or a group of people.
9. Elon Musk has a lot of pull when it comes to cryptocurrency prices
Elon Musk has contributed to huge swings in cryptocurrency prices in 2021. The market pays attention when he tweets or speaks about cryptocurrencies. At least, his ardent supporters do.
Musk has had an impact on the price of bitcoin, dogecoin, and the cryptocurrency market as a whole simply by announcing which coins Tesla will accept for car purchases.
Some countries ban cryptocurrencies
Not every country allows the use of cryptocurrencies. Some countries, like Turkey, don’t allow cryptocurrency payments, while others, like Nigeria, ban cryptocurrency exchanges. It’s practically impossible to actually ban the use of cryptocurrencies, even though countries can regulate access to service providers and shut down exchanges. But with one of the world’s largest economies coming out against cryptocurrencies, it’s hard to say how things will change in the future.
How to get started investing in crypto
If you are a newbie in the crypto market, it’s important to understand your portfolio goals and interests, as well as which coins you think are likely to have staying power. Learning how to invest money is about more than jumping on a popular bandwagon.
As a veteran crypto investor or trader, you’ll definitely find Bitmama to be a breath of fresh air. There are also lots of benefits attached to using our app which include but are not limited to our crypto cards feature. Find out more about Bitmama here.