Despite the sophistication of our civilization, it was not an expected turn of event that even money would go completely electronic—cryptocurrencies. They are encrypted information that serves as virtual tallies that count an individual’s score of digital possessions. What’s even more surprising is the level of acceptance they are already gaining. Statistics from the research conducted by Cambridge University indicated that there are averagely 3 million different users of cryptocurrencies; in fact, more than 100,000 merchants and suppliers accepted payments in Bitcoin in 2015. One is compelled to question what exactly these cryptocurrencies are.
Cryptocurrencies are exchangeable materials that take advantage of their encryptions to secure transactions. For one thing, the idea of cryptocurrencies came with the notion of decentralized financial authorities that oversee the affairs within the network. There are no regulations from any Central Bank or group of people, yet the entire system is safe and secure. The first of these digital currencies to gain a true foothold was the Bitcoin. There are several other alternative coins or cryptocurrencies and some are Litecoin, Ethereum, Darkcoin or Dash, Zcash, Ripple, Monero, etc. It is worth a mention that since 2009, in the space of eight years, Bitcoin has improved in value as immensely as a $27 turned $17,000! Can one simply call this the biggest financial payoff of this century? Perhaps we should watch out for more impressive trends.
Africa makes 16.6% of the world population and 9.4% of the world’s internet users
It is indeed a sad reality that Africa is yet to catch up with the current pace of technological advancements, although we are not stationary. Based on Internet World Stats, Africa makes 16.6% of the world population and 9.4% of the world’s internet users or more precisely 1 in 4 African youth are exposed to the internet one way or the other. But of what good is this internet exposure if 1 in 2 Africans live without electricity and survives on less than $3 a day? Of what good is the exposure if they are blind to the freshest opportunities offered by the internet? A call beckons on the true African millennial to seek beyond the digital crumbs. Instead, African millennials should benefit from the true nutrition offered by these digital coins. And with a little effort and a handful of knowledge, you can move the mountains of financial success.
Before we look into how African millennial can indeed leverage the cryptocurrencies to make wealth, it would suffice to summarize how cryptocurrencies work precisely. They are electronic currencies that an individual can own and create. Then once any transaction is made, it is recorded in a general ledger called “Blockchain”. This ensures that the entire system is not broken, and the blockchain is not managed by any single individual. The blockchain represents the effort of the bitcoin community who enter the details of whatever transactions they deal. The coins cannot be stolen and affords the owners the luxury of privacy.
Below are a few ways African millennial can engage in to harness the fruits of cryptocurrencies. Each of the ways enumerated has its own bag of promises, as many have ventured into them and had been generous with their testimonies.
1. By Mining Them
It turns out that Bitcoins can be mined like gold. You can create more of it by working out some mathematical problems that has to do with the SHA256 or Hash functions. Take the example of doing the following: 1+2+3+4 to get 10. It is easy to use the simple addition procedure operated on 1, 2, 3, and 4 to obtain 10, but say we take 10 and attempt to get back the numbers that summed up to result it, it would take extremely powerful computers 10 minutes to do. The computers actually try over a billion guesses (like 5+5, 2+3+5, 4+6, 1+9, 3+6+1, etc.) until it arrives at the one that unlocks the problem. It is however a worthwhile adventure because a miner can get 12.5 Bitcoins (that’s over $8,000) for solving one such problem!
In addition, as more problems are being solved, the complexity graduates. Currently, miners can hardly create Bitcoins with their laptops; they would have to use expensive computer networks and power. You can consider that an investment though.
2. Go for Altcoins/Bitcoins and Keep them for Future Sales
There was a point in time when Ethereum improved in value from slightly over half a dollar to over $5 in a period of two months. That is the idea to capitalize on. Just like land, cryptocurrencies have this interesting property of always appreciating in value. Take advantage of the ever-increasing value of these cryptocurrencies. Make the most out of them in the future as they appreciate in value. But you have to exercise profound caution when going into this. You have to do your research well, make findings as to the trend of the cryptocurrency that interests you, and then commit your investments. Usually, you might have to wait months, but it is definitely worth it when you take the eventual payoff into consideration. One rather certain outcome is when the glory comes, you would simply agree more with the saying “whatever one sows, he reaps”.
3. Trade Bitcoins
Just like Forex and the Stock market, there are some momentary uncertainties that are associated with Bitcoins; they are currencies after all. With some technical analysis, one can identify up points to sell at high prices after buying at down points at much cheaper prices. We would not be wrong to picture the trade as a Bitcoin version of Forex, where instead of having pairs like USD/EUR, you have pairs like BTC/USD and BTC/LTC. So the logic here is: buy cryptocurrency when they have low value and sell them when their value improves significantly.
Projections estimate that there will be sufficient Bitcoins for mining until around 2140. That means over 20 million Bitcoins available to scoop in over a century. What is a better way to define “opportunity” other than having over 21 million Bitcoins at one’s disposal? That is exactly how African millennial should see cryptocurrencies, except they should see them as wishes already made horses for all to ride.