## Metaverse is the future of internet evolvution! But do you know how to invest in metaverse?

The [metaverse](https://www.investopedia.com/metaverse-definition-5206578) comprises a digital environment where people interact with each other. This digital evolution is meant to revolutionise industries like sales, finance, marketing, fitness, education, finance, banking, and more. It is believed the metaverse will achieve this by making an economy with minimal laborious work and more leisure time without compromising the quality and quantity of the work in these industries. The metaverse is an amalgamation of our physical and virtual worlds and sets new goals for the work prospects in a profitable economy.

## How to Invest in Metaverse? Options to Explore

It is possible to invest in metaverse directly and indirectly. There are several ways of investing - let's explore some:

### 1.   Buy metaverse crypto

Buying cryptocurrency is one of the easiest ways to invest in the metaverse. You require a virtual wallet to store crypto tokens and the proficiency to partake in a coin trade. Different nations may have their own rules and regulations for partaking in the trade, such as identification and Know Your Customer (KYC) validation.
Among the most popular metaverse cryptocurrencies are MANA from Decentraland, SAND from The Sandbox, BLOK from Bloktopia, and AXS from Axie Infinity.

### 2.   Invest in metaverse stocks

Purchasing shares in a metaverse enterprise is another way to invest in the technology and it does not require an individual to control cryptocurrency or even open a digital wallet. However, this investment choice is relatively tough as metaverse stock investments are primarily meant for serious investors who have been, generally, involved in the field for a long time.
Some of the top stocks to invest in includes Meta Platforms Inc. (FB), Electronic Arts (EA), Roblox Corp. (RBLX), and Nvidia (NVDA).

### 3.   Build, purchase, and trade NFTs

One of the hottest ways to invest in the metaverse is via [non-fungible tokens (NFTs).](/news/article/nft-art-marketplaces) You can build 3D objects and list them on metaverse marketplaces for sale, which is a technically difficult process. Or, an individual can directly buy NFTs and sell them for a profit, which is comparatively less complicated.
NFTs have gained huge market traction and are one of the popular ways to invest in the metaverse.

### 4.   Acquire metaverse land

Purchasing land is the next most profitable mode to invest in the metaverse. Once the investor creates their digital wallet, they can choose an emerging metaverse platform, explore its layout and available properties, zero in on the property they want, and make an investment.
The process is comparatively straightforward, but involves more risk than crypto token investments as the value of virtual land relies on various unanticipated factors, such as the speed of developing adjacent properties. However, it is among the most famous investment strategies, and experts anticipate the market value could surpass $1 billion this year.

### 5.   Purchase metaverse ETF

A metaverse Exchange Traded Fund (ETF) is a trending investment method that enables you to buy a collection of crypto stocks that a dedicated fund manager actively barters.
ETFs are analogous to mutual funds, in that they curate a set of identical or thematically collected stocks into a single acquisition that delivers relatively predictable returns. However, they vary as a dedicated fund manager actively barters using the ETF and assures it to hold its optimal market worth.
Leading metaverse ETFs that emerged in the last 12 months include Roundhill Ball Metaverse ETF, Subversive Metaverse ETF, and ProShares Metaverse Theme ETF. However, the difficulty of investment is high as most ETFs have the lowest investment threshold of up to $1,000. It is advisable to have initial experience in the stock market.

## Step-by-Step Guide to Investing in Metaverse Coins

### Step 1: Make a crypto wallet.

Every investment, just like physical entities, demands a wallet full of money. You must build a crypto wallet and load it up for purchases in the metaverse. You can build your account on popular platforms like Binance for crypto purchases. For NFTs globally, people prefer MetaMask. Verify your identity to validate your wallet.

### Step 2: Select the mode of metaverse investment you would like to invest in.

### Step 3: Make the payment and enjoy the returns from your metaverse acquisitions.



How To Invest In Metaverse

If you have ever wondered how to mine Bitcoin Cash and how long it takes to mine one [BCH, ]https://bitcoincash.org/) this article is for you.
Before blockchain, money transactions were primarily regulated by two bodies: the government-regulated central banks that print the new cash and regular banks that were involved in money transactions on your behalf. Acting as regulatory bodies, they had complete power over your transactions and money.

The Bitcoin blockchain and its native cryptocurrency [BTC](/coins/btc) were created with the concept that a person should have complete control of the money and transactions they make, and that no other authority or regulatory body should have control of the funds.
Mining is the method by which transactions are verified.

Miners have complete documents of ledgers which they update in sets called blocks. These blocks are then added to the network for other miners to update their ledgers.

The blocks are made by cracking cryptographic problems using computing power, a digital equivalent of the physical effort to mine valuable resources, hence the term miners.

Bitcoin miners receive Bitcoin tokens as rewards.
In August 2017, a fork on the Bitcoin blockchain led to the creation of Bitcoin Cash (BCH). It improved scalability and allowed more transactions to be processed by increasing block size.

## How to Mine Bitcoin Cash and How Long it Takes

In broad terms, crypto miners take 10 minutes to mine one block of Bitcoin Cash. To maintain the 10-minute speed to solve the complex mathematical query, the difficulty level of the problems alters automatically.
When more miners and more computing power endeavour to mine, the difficulty level increases, whereas, when there are fewer miners and less computing power, the difficulty level decreases.

## Requirements to Mine Bitcoin Cash

Mining is similar to any other business engagement, where profitability relies on several factors unique to that venture. In Bitcoin Cash mining, these factors represent the requirements you should have before starting the bitcoin cash mining, including the type of hardware and software to pick. Here is what you should know:

### Hardware for Bitcoin Cash

Picking the right hardware is critical whenever you want to mine cryptocurrency. Today, an ASIC miner is what you require to get the hash rate needed to mine BCH. You need to remember that hardware is the major initial investment cost. The price of the ASIC miners has increased, seeing the power it supplies to the mining activity. A new AISC hardware costs anywhere from $2,000 to over $7,000, with older models available at lower costs.
So, when evaluating an ASIC miner, pay attention to the price, which is relative to three other factors:

•	Hashing/Computing power (in hashes/second)

•	Power consumption

•	Efficiency

Hashing power is the count of hashes a hardware machine can generate while solving a block. It's calculated per second, and the higher the figure, the more effective the machine and the more pricey.

Power consumption is related to the electricity (energy) required to run the miner optimally. It is measured in kilowatt-hours and can affect profit if too high. That's when you review the third factor, efficiency.

An ASIC miner is needed, and one with a high hash rate. However, it should not lead to too much power wastage.
Efficiency: This factor reveals how much power must be used to get a single BCH coin. An effective and powerful machine consumes less electricity than others when mining Bitcoin Cash.

If you have chosen your hardware machine, it's worth checking the other related requirements:

•	Electricity: cheap and stable is best. Having a backup is perfect.

•	Internet connectivity: 24/7 internet connection- an inconsistent connection will smash your chances of success.

## Software Requirements

Software is another critical requirement you must consider to look at as you opt to mine Bitcoin Cash. Mining software connects with your hardware machine to process the mining. It will deliver an interface for linking with the network to monitor the process and check profits.

You can get mining software applications for mobile and desktop use.

## Which Software Do People Prefer to Use to Mine Bitcoin Cash?

There are multiple software applications you can pick from to mine Bitcoin Cash. However, the two most widely used in the industry today are CGminer and BFGminer.
Both are command-line programs, which implies you can operate on the interface to get more into the mining process. Don't worry if you find the command-line interface (CLI) a little complex; EasyMiner is a great option that offers computerised functionality and sustains both self-mining (solo) and pool mining.
Note: Most ASIC miners are available with pre-installed software. If it's not, perform research to find one compatible with your hardware.

## Technical knowledge required to mine Bitcoin Cash

Before starting your Bitcoin Cash Mining journey, one of the basic requirements is understanding the technical terms connected with the mining process.

•	Consensus algorithm: 

It is a blockchain technology mechanism that permits agreement between a distributed network of users or machines. For example, a Proof of Work consensus algorithm lets miners agree on verifying blocks before they are updated to the blockchain.

•	Blockchain: 

It is a distributed ledger of all the trades on the network, managed in data blocks that are validated every 10 minutes. Miners get rewarded when they secure the network by updating a verified block to the blockchain.

•	Block time: 

This is a time estimate coded in the protocol: how much time miners take to validate blocks and update them to a distributed ledger. Bitcoin Cash has a block time limit of 10 minutes.

•	Hash rate: 

The measure of hashing power required to crack a complex puzzle and validate a block of trades. It's also called computing power and is calculated in hashes per second. The more per second hashes a machine produces, the more effective it is and the higher its probabilities of finding a block.

•	Mining difficulty: 

This is to calculate and find how difficult it is for a miner to find a new Bitcoin Cash block. It's also called a difficulty adjustment algorithm (DAA) and corresponds to the hashing power a miner requires to mine a single block within the calculated block time. For Bitcoin, the difficulty alters every 2016 block, while BCH introduced an Emergency Difficult Adjustment (EDA) algorithm in November 2017. The latter also leverages a retarget of the last 144 blocks to alter the difficulty.

•	Mining fees: 

A miner fee is a small amount of money users link to the blockchain trade to incentivise miners to process their trades. This amount is in addition to the 6.25 BCH in the block reward.

•	Block rewards: 

This is a reward given to a miner(s) who cracks the complex mathematical cryptographic puzzle on the network. For miners, Bitcoin Cash offers a block reward of 6.25 BCH.

## Pros and Cons of mining Bitcoin Cash

Mining Bitcoin Cash includes both pros and cons aspects. Let's see the pros and cons:

### Pros

1.	Block rewards can be very fruitful and profitable, and as a miner, you can earn good money.
 
2.	The transaction fees also complement rewards for successfully mining. 

3.	A good mining pool selection can raise your chances of block rewards.

4.	Your mining endeavours secure the Bitcoin Cash network.

5.	Old ASIC hardware can still be traded second-hand, as the market exists for other networks.

### Cons

1.	A high hash rate implies you may experience losses if you can't compete.

2.	ASICs need a heavy energy supply, resulting in a high electricity bill.

3.	Pools can reduce your reward as it is distributed among members.

## Is Bitcoin Cash Mining Profitable?

### To determine how beneficial it is to mine BCH, you must consider the factors mentioned below.

•	Hashing power

•	Power consumption

•	Cost of electricity

•	Pool fee

•	Bitcoin Cash price

You can decide if mining Bitcoin Cash will be profitable when you consider the hardware machine's computing power (output in Terahashes per second (TH/s) or Gigahashes per second (GH/s)). Another notable factor is the amount of power the hardware will consume and the expense of electricity per kilowatt-hour (kWh).


How to Mine Bitcoin Cash (BHC) 

The evolution of the cryptocurrency world cannot be discussed without [“ENJIN”](/coins/enj) coin popping up. The purpose of ENJIN coin, and its advanced features, certainly make it worth talking about. 

ENJIN coin (ENJ) is an ERC-20 token traded on the [Ethereum blockchain](https://coinmarketcap.com/currencies/ethereum/) launched by the company [Enjin](https://enjin.io/). At first, ENJIN was founded as a network, a community gaming platform, in 2009 by Maxim Blagov and Witek Radomski. 

In 2017, ENJIN coin was launched to try and make NFT usage easy for individuals and enterprises. As we all know, there’s a massive buzz around NFTs in the crypto space right now, with many investors seeming to become millionaires overnight. 

On November 25, 2021, ENJIN coin reached an all-time high of $4.85. That was during a favourable period for the crypto markets. Today, the ENJIN coin price stands at about $0.90. 

Despite the comparatively low current position, there are indications that the longer-term fortunes of ENJIN may be better. 
 
## What is ENJIN About 

You probably know a little of what this coin is about, but let’s add to that knowledge. 

ENJIN is designed to integrate with games. Some gaming platforms are exposed to risks, such as manipulation, scammers, and hackers. Virtual items have been reported stolen. In addition, users sometimes complain about transaction fees and speeds, as well as ‘centralization’ locking assets into a single game. 

These all impact the reputation of the game and platform. 

ENJIN was designed to help combat some of these issues and create a safer space for gamers. 
Items bought by players with ENJIN can be used in multiple games and can be traded and sold in an online marketplace with ease. In addition, ENJINwallet can be used to buy, sell, and trade NFTs, while ENJIN coins can be used as a currency. 
With the ENJIN platform, gamers and content creators can manage and trade their NFTs successfully and easily. 


ENJIN tokens run on a proof of work (POW) consensus algorithm, meaning that, like Litecoin, ENJIN tokens are created through mining. The mining process for all cryptocurrencies running on POW is the same. Miners verify their transactions by completing cryptographic equations and then move to the next transaction. For effective ENJ mining, the best way to go about it is by using the ASIC mining setup. 
 

## How To Buy ENJIN 

The first step to buying an ENJIN coin is to have an Ethereum wallet compatible with ER-20 tokens. ENJIN coin is available on a range of exchanges. 
The amount of coins you buy entirely depends on you. As I always mention, cryptocurrency is a high-risk investment; investing depends on the amount of risk you are willing to take. 


## Conclusion 
While the ENJIN coin value has fallen from its November ’21 high, there is potential for this cryptocurrency. Features aimed at making gaming safer and easier are likely to continue finding favour with gamers. In addition, its use in the NFT space aligns it with a rapidly expanding industry. Both could contribute to a brighter future for ENJIN coin. 


You can read more guest articles at [brendanbeeken.com](https://brendanbeeken.com/). 

What Is ENJIN Coin?

The Sandbox blockchain is a community-driven NFT game where users can create their own worlds and earn cryptocurrency. It is one of the top games that implement the play-to-earn model (P2E), allowing players to develop assets and profit from them.

## What is The Sandbox All About?

The Sandbox is a multiplayer game that allows players to create their own worlds with unique objects. You can draw relief maps, make all kinds of puzzles, build a labyrinth, or visit the created worlds of other users. The Sandbox games don’t require programming skills; you just need to realize your ideas and create your own game. You can create games alone and with friends.

## How does The Sandbox work?

The Sandbox world consists of voxels (pixels with 3-D volume), similar to Minecraft’s cubic graphics. But it gives everyone a chance to create a game, design characters, and earn SAND tokens by finishing quests.

## Where can I play The Sandbox games?

The Sandbox is easily available on the App Store and Google Play Store. It also has a desktop version, only supported on a PC with at least a 64-bit processor, minimum Windows 7 and 4GB RAM.

You can start this creative unique by owning plots of LAND, which is a space to build assets, such as games and building, turning them into profits.

As of April 2022, the value of 1 SAND is $2.96 (£2.27).

## How to earn money in The Sandbox games?

The game’s main idea is to create unique items you can sell. So, you have to be creative to make money in the Sandbox.
One way to earn some SAND is to create artworks and sell them on the market. Another way is to create game designs and charge other players to play them.

If you want to generate passive income, owning LAND can also help you earn as the price of the cryptocurrency increases when more players invest in the game.

The game also allows users to rent out their LAND to other players and earn by participating in competitions and playing platform games.

## How to get started

To play the Sandbox game, you will need to install a wallet as a smartphone app or a browser extension to store your SAND and virtual assets like LAND.

The start can be quite expensive as you will need to invest some money into SAND and LAND. Once you log in with your wallet and buy real estate, you can start trading NFTs and assets. You can start creating your own by using one of the free tools The Sandbox offers:

•	VoxEdit: a free 3D modeling software for PC and Mac.
•	Market: a decentralized NFT marketplace, allowing users to trade assets for profit
•	Game Maker: a basic visual scripting toolbox editor, allowing to design games without coding

If you learn more about these tools, it will help you demonstrate your creativity and make a profit in no time.
What Does the Future Hold for The Sandbox in Metaverse?

One of the most promising NFT projects, The Sandbox, has partnered with over 165 brands, including The Walking Dead, Atari, and Smurfs. It has also raised $93 million so far and is dedicated to establishing its grounds in Metaverse.


Metaverse Sandbox Games: How to Play and Earn?

For people new to the community, the number one question is ‘how to trade cryptocurrency’.

This isn’t a surprise, especially as the volatile nature of cryptocurrency – the rapid increases and decreases in price – creates a lot of opportunity for the trader. However, we must remember that while volatility can create opportunity for profit, it also creates the risk of loss.

The long-term potential of cryptocurrency is hard to assess, given it remains a relatively new phenomenon in finance. Early adopters have seen massive returns and while it is becoming more widely used, the opportunity for significant profit still remains.

The fact it is new, and broadly based around an ethos of [decentralisation](https://www.worldbank.org/en/topic/communitydrivendevelopment/brief/Decentralization), means governments around the world question its legitimacy. That creates risk, as well as the possible potential opportunities could be curtailed in future by regulation.

## Measuring Volatility

To explain how you measure volatility, we will use [Bitcoin (BTC)](/coins/btc) as an example. Basically, look at how the average price from the start of the day has varied and apply a calculation. For instance, take 10 measurements from the day to give you a sum of price variation, square that and then divide by 10 (the original number of measurements). The volatility measure of that day is the square root of your result.

To extrapolate over a fixed period, you multiply that result by the square root of the number of days (ie, for a year, multiply your volatility measure by the square root of 365).

## Trading vs Investing

Your challenge is to manage the risks posed by trading in cryptocurrency and make money – by which we mean selling a cryptocurrency asset for more than you paid for it.

Start with two basic questions: will the asset price go up or down in the next day, and will it go up or down over the next four years?

These questions require you predict the price movements, which are, of course, uncertain, but there is a big difference in time frame, which should make you think about the investment, and risk, differently.

What makes a difference in the next 24 hours will not necessarily be the same as what influences the longer-term price trend. You cannot really make a long-term prediction based on one day’s results.

Buying and selling over short periods is trading. Buying an asset and "holding" it for a longer period before selling for profit is called investing, or hodling.

To make money from cryptocurrency, you need to understand the strategy for each. You don’t have to fit into one category or the other – you can both trade and invest, as long as you understand how the decision making differs between the two.

## Analysis

Analysing short-term asset price movement and volume of trading is known as Technical Analysis. When you take a broader look at potential influences, especially on the longer-term value, it is known as Fundamental Analysis.

They can overlap but are a good framework to separate trading from investing, although both ultimately come down to measuring risk.

## Stay Grounded

You should aim to sell your cryptocurrency asset for more than you bought it for, whether you are trading or hodling. This is where a structured approach and skill-based decision can help manage risk.

If you are trading best on instinct or a random social media post, your fortunes rest with luck. The best traders have a strategy based on analysis and have spent a long time learning. You need clear objectives founded on knowledge and mathematical discipline.

You can learn by doing, so keep a record of your trades and how they went. This is the experience which can help make you a better trader or investor. Start with a realistic goal, be honest with yourself and learn from your mistakes and your victories.

Also be honest that sometimes, despite all your learning and preparation, an outcome can be down to luck. One good result you were not expecting doesn’t mean you have suddenly become a great trader. It’s important to recognise that.

cryptocurrency charts and man trading crypto

A Guide to Cryptocurrency Trading

Are you looking for cryptocurrency books to help you learn more about Bitcoin and blockchain technology? You're in the right place.

Here, we recommend some of the best books on the market for getting started in cryptocurrency.

Each book provides an in-depth look at Bitcoin and blockchain technology and will teach you all you need to know about these exciting new technologies.

So, without further ado, let's get started!

### Ethereum: Blockchains, Digital Assets, Smart Contracts by Henning Diedrich

This book is a great starting point for anyone looking to learn about Ethereum and blockchain technology. It provides a comprehensive overview of Ethereum and covers blockchains, digital assets, and smart contracts.

Additionally, the author has years of experience in the cryptocurrency industry and is well-known for his work on the Ethereum project.

The book opens with a focus on what blockchain is, how it works, and why it's so important for cryptocurrencies. The second part provides an introduction to Ethereum and explains how it works.

Chapter 3 goes into the technical details of the Ethereum protocol and its consensus algorithm, the Casper proof of stake (PoS) model.

Finally, chapters four to six provide a deeper dive into the three main use cases for Ethereum: decentralised apps (dApps), smart contracts, and decentralised exchanges (DEX).

What you will learn with this book is Ethereum's core concepts, blockchains, digital assets, and smart contracts, and you will understand the difference between permissioned and permissionless blockchains.

Summing up, the book is an excellent resource for those looking to understand how Ethereum works and how it can be used to create smart contracts.

### Blockchain Revolution by Don and Alex Tapscott

For anyone looking to learn about the potential of blockchain technology, this is a good read. It covers everything from the history of blockchain to its current and future applications.

The authors are also well-known experts on blockchain technology. Their book provides an excellent overview of this exciting new technology.

### Mastering Bitcoin by Andreas M. Antonopoulos

This book is a comprehensive guide to Bitcoin, covering everything from the basics to more advanced topics such as mining and security.

Andreas Antonopoulos is a well-known Bitcoin expert, and his book provides a great introduction to this exciting cryptocurrency.

The author has been a speaker at many conferences, including the Bitcoin conference in San Jose and the Scaling Bitcoin conference in Hong Kong.

He has also featured on [BBC](https://www.bbc.com), [CNBC](https://www.cnbc.com/world/?region=world), Wired, Time, Forbes, the Wall Street Journal, CNET, PCWorld, and others.

## Conclusion

In conclusion, there's a vast amount of information online about cryptocurrency, but it's scattered across different websites, forums, blogs, and social media platforms.

Where do you start and what information do you trust? And it's even harder to figure out which books, articles, videos, and podcasts will help you learn about cryptocurrency and blockchain technology the best.

That's why we made this list. It features everything from beginner-friendly to in-depth technical guides, whitepapers, and books

For more [Business news](/news/category/crypto-business-news).



Cryptocurrency Books: Learn About the Best 

Do you choose [Bitcoin](/coins/btc) or [Ethereum](/coins/eth)? Yes, there are thousands of coins and tokens, but these remain the big names.

Disclaimer – This article is not investment advice and should not be taken as recommending a strategy. It is for information only. Before investing your money, ensure you conduct your own extensive research.

Cryptocurrencies are the assets increasing numbers of people are looking to as they seek to diversify their portfolios.

Volatility, and therefore a higher chance of earning huge profits, is one reason.

It has been a bumpy ride for crypto. After taking centre stage in 2016-17, its prominence faded due to acceptance levels and [regulation](/news/tag/regulation) concerns.

More recently, interest has soared with record-breaking values and a market cap in excess of $2 trillion.

The potential profits have driven interest, but other benefits of cryptocurrencies have helped. These include:

- Decentralised Nature
- Fast Transactions
- Secure Transactions
- Transparent System

The upwards trend has led to many investors considering digital assets and beginning to learn about them. Some then face a dilemma; where do they invest?

Due to their market prominence, the main choices are Bitcoin or Ethereum. But which one?

## Bitcoin

Bitcoin (BTC) is often regarded as the first cryptocurrency, coded by anonymous Satoshi Nakamoto. As the first and best know, bitcoin has become synonymous with cryptocurrency. Its name recognition has contributed to stellar values.

At the time of writing, BTC is trading for $20,194 and is responsible for around 40% of the cryptocurrency market. At its peak, it traded at $68,789.63.

Bitcoin’s efficiency is, comparatively, lower than many other well-known cryptocurrencies. The transaction speeds are relatively low, and power consumption is high.

This is because Bitcoin works on the Proof of Work (POW) principle rather than Proof of Stake (POS).

However, BTC fulfils its purpose of being a decentralised currency that can be traded globally with ease and convenience.

## Ethereum

Second on the list of cryptocurrencies [by market cap is Ethereum](https://coinmarketcap.com/currencies/ethereum/). At the time of writing, its price is $1496.70.

Ethereum has a market cap of $365 billion, considerably less than Bitcoin’s $817 billion. This represents around 18% of the cryptocurrency market. Its value has increased from $1,300 to the current price in just a year.

Ethereum is a popular blockchain used for drafting smart contracts to assist in almost any form of transaction. The transactional token that facilitates operations on the Ethereum network is ether.

Like Bitcoin, it works on the less efficient Proof of Work (POW) principle, yet is more efficient and has higher utility when compared to that of the Bitcoin blockchain.

To improve its efficiency, Ethereum plans to launch an update named Ethereum 2.0, which will work on the Proof of Stake (POS) principle. The aim is to make the overall blockchain more efficient.

Due to the Ethereum blockchain’s ability to code smart contracts, its utility value, compared with Bitcoin, is a lot more. Due to this property, it’s easy to develop a Decentralised Application (dApp) on the Ethereum blockchain. In addition, smart contracts are easier to code, which is helpful in developing decentralised finance contracts and assists in NFTs transactions.

The Ethereum blockchain is so versatile that it even helps form new cryptocurrency tokens, altcoins coded on the Ethereum blockchain. They can stand out individually, separate from ether, and have individual use cases like any other cryptocurrency.

## The Future

If we compare ETH and BTC prices for the last year, ETH seems to be the more logical investment as it had a better high to low ratio than BTC.

As the move towards decentralisation continues, the applications of the Ethereum blockchain will increase, making it tough competition for Bitcoin, even when their values are so far apart.

## Disclaimer

This article is not investment advice and should not be taken as a recommended strategy. It is for information only. Before investing your money, ensure you conduct your own extensive research.

You can read more guest articles at [brendanbeeken.com](https://brendanbeeken.com/).


Guide to Ethereum vs Bitcoin


People are afraid to invest in cryptocurrencies because they don't understand it, and they're worried about what could happen if the bubble bursts.

This article explains brain FUD tactics, how to recognise them and how to avoid them.

## What Is FUD and Why Should You Care About It

[Crypto FUD](https://cryptochronicle.io/the-danger-of-fear-uncertainty-and-doubt-fud-in-the-crypto-market/) is a term that refers to the fear, uncertainty, and doubt that is commonly expressed in discussions about cryptocurrency. As crypto becomes more influential and disruptive, an increasing amount of brain FUD circulates online and in the media.

This can have negative consequences for those new to crypto, as it can be challenging to separate fact from fiction when you're just getting started with this exciting [new technology](/news/tag/technology).

At its core, brain FUD is rooted in ignorance and misinformation about crypto. The goal of this brain FUD is often to paint crypto in a negative light or to discourage people from investing in digital currencies.

However, all crypto enthusiasts need to recognize and resist this type of negative rhetoric to foster greater understanding and adoption of these emerging technologies.

By educating ourselves about crypto FUD, we can help ensure this exciting field's long-term growth and success.

## How to Spot FUD and Protect Your Investments

When investing, it is essential to be able to spot FUD – or fear, uncertainty, and doubt.

FUD is the primary tool that malicious actors use to manipulate the market and generate profits for themselves at the expense of others.

By understanding how brain FUD works and how to recognise it, you can protect yourself from being manipulated and ensure the stability of your investments.

One of the key features of brain FUD is that it often uses emotionally charged language and persuasive arguments to try and scare investors into making rash decisions.

This may include spreading misinformation about competitors or exaggerating potential negative outcomes to create panic among investors.

Additionally, brain FUD tactics may involve targeting a particular group or demographic, such as those who are new to investing or hold a particular opinion on a controversial topic.

It is important to remain calm, rational, and objective when weighing your options to protect yourself from brain FUD and other manipulative investment strategies. 

Be sure to pay close attention not only to factual information about your investments, but also to the tone and underlying motivations of messages related to them.

If something seems off or suspicious, do your own research to determine whether you should trust the source.

## Final Thoughts on the Current State of Cryptocurrency

Cryptocurrency has come a long way since its inception, but there is still much work to be done. The space is plagued by brain FUD, making it difficult for new investors to get involved.

However, the current state of cryptocurrency provides many opportunities for those willing to take the risk. 

There are many different projects underway that have the potential to revolutionise the space and seeing them develop will be exciting.


Guide to Brain FUD Tactics in Cryptocurrency

Investment in non-fungible tokens, or [NFTs](news/tag/digital%20art), continues to increase. With that comes a growth in collections to buy and more options for which NFT marketplace to use.

Where do you start if you are new to these ‘trendy’ digital assets, which encompass everything from outstanding art to celebrity and sports franchise tie-ups?

## The NFT Marketplace

NFTs have been a runaway hit with investors. They have attracted buyers who understand the value of blockchain-linked assets and those purely interested in the subject, from [cartoon apes](/news/article/lazy-monkey-nft) to [legendary NBA players](/news/article/stephen-curry-nft).

The decline of the cryptocurrency market in 2022 helped boost the NFT marketplace. Uncertainty about crypto tokens, underlined by the most recent cash, saw investors turn to alternatives like NFTs.

## Choosing an NFT Marketplace

Dedicated NFT marketplaces are the preferred option for most investors. While some offer multiple collections and artworks, others focus on a single subject or artist.

If your interest in NFTs is subject-led, your NFT marketplace options may be limited. If, however, your taste is broad or your interest is in potential value rather than subject, there is more choice in where to buy and sell.

As you look through the NFT marketplaces out there, you’ll notice they have differing functionality, appearance, personality, and interface.

Like any shop or physical market, different ones appeal to different people.

When it comes to making your choice, assuming you are not set on acquiring work from a specific collection or artist, it is important to select one you like.

Just like choosing a cryptocurrency exchange, ensure it suits you and how you want to interact.

Ensure it is safe and secure, just like you would with a crypto exchange.

The best advice is to take your time and do your research. Read independent reviews, check out what other users are saying online, and ensure you are entirely comfortable before engaging.

To help you begin your research and selection, here’s a brief look at some of the most popular NFT marketplace options.

## Popular NFT Martketplaces

### [OpenSea](https://opensea.io/)

This is one of the most popular NFT marketplaces and styles itself as ‘the largest NFT marketplace’.

Its popularity has been helped by the provision of a wide variety of features, especially those making it easier for novice buyers to get involved.

OpenSea includes a step-by-step guide to creating NFTs and handles the whole minting and sale process.

While it is a user-friendly platform for NFT creators and investors, new and old, some caution must be exercised.

Twice in 2022, OpenSea has been targeted by phishing hacks. While this is not hugely unusual in the cryptocurrency space, it is worth being aware of.

### SuperRare

Position as an art gallery in the NFT ecosystem, SuperRare is considered a venue for high-end NFT art. That is due to its selective approach on which NFTs to list – you won’t find simplistic ‘meme’-style art here.

The time taken to consider what to list gives buyers a feeling of confidence in the potential value of their acquisitions.

If you are looking for quality art, SuperRare might be the right choice, although do check the charges before you commit.

### [Nifty Gateway](https://www.niftygateway.com/)

Nifty Gateway is similar to SuperRare in some respects. It is renowned for exclusive and expensive sales, such as the $91.8 million sale of The Merge, by digital artist Pak.

Here you will find an [emphasis on ‘art’,](/news/article/nft-art-marketplaces) with plenty of work from leading artists and related to celebrities. Demand is boosted by time-limited sales through its ‘open editions’ system.

It achieved greater prominence in 2019 when the Winklevoss twins’ business Gemini bought it.

What attracts some investors is that Nifty Gateway allows credit card purchases.

### Rarible

This NFT marketplace has a more diverse selection, spanning not only high-end art, but also collectibles, video game assets, and more.

Its popularity is encouraged by the fact that credit cards are allowed, you can deal in cryptocurrencies Ethereum, Flow, and Tezos, and there is a flat transaction fee (plus any related gas fees).

A point of difference is that Rarible is that not all management decisions are made internally. Holders of its native token, RARI, can vote on company policy.

Another boost to investor confidence came in 2021, when Rarible partnered with Adobe. The aim was to make verifying and protecting digital content metadata, including for NFTs, easier.

Rarible offers investors a more extensive selection of NFTs than many, gives users access to a wide network of connections, and still retains a decentralised mindset.

### Binance

Binance is already one of the biggest cryptocurrency exchanges and entered the NFT world in 2021 when it launched its own marketplace.

You will find collections similar to most other general marketplaces, such as art, collectibles, and gaming items. An attraction for many is low fees and a user-friendly platform.

The layout and interface are similar to the Binance exchange. This makes dealing in NFTs relatively simple, especially if you are already familiar with Binance.

A further advantage is that Binance has its own blockchain.

Binance’s reputation and size give some confidence to those who are new to NFT investment.

### NBA Top Shot

While this NFT marketplace is focused solely on basketball, its popularity means it warrants inclusion.

While this one is primarily aimed at fans of NBA basketball, general investors have taken an interest because of the sums involved.

The collections are NFTs of great moments in NBA history, including video clips, artworks, and play highlights. They are not cheap – a clip of a LeBron James slam dunk sold for $208,000 last year.

For those who are not major basketball fans, a real attraction of this marketplace is that the NBA itself runs it. That means you know you are dealing with a large and reputable organisation.

Another plus for investors is that NBA Topshot allows the use of popular cryptocurrencies, including Ethereum and Bitcoin, as well as credit and debit cards. As always, ensure you check the fees before committing.

### NFT Investing

I have listed some popular NFT marketplaces available. There are many more and you should conduct your own thorough research before choosing which to use, should you decide to become an NFT investor.

Before you do invest your own money, remember that digital asset values remain highly unpredictable. The headlines suggest NFTs are sound investments and talk about huge returns.

They are, however, still relatively new assets and the future is hard to know. Like cryptocurrency, NFT values are subject to volatility, and it remains to be seen whether the sky-high prices we see now can be maintained.

If you choose to invest, select your marketplace carefully, do your own research, and don’t spend more than you know you can afford to lose.



Guide to the best NFT Marketplaces

It’s one of the inevitable questions from people not involved in the blockchain and cryptocurrency space – how can they, being entirely digital, have any value, in terms we generally understand (like the gold standard)?

The basic properties of any currency considered ‘sound’ include durability, divisibility, fungibility, portability, recognisability and scarcity. Most of these apply to digital currencies, but scarcity is hard thing to impose in the digital world.

It is, however, important, as value comes from scarcity – think gold and diamonds.

Creating scarcity for cryptocurrencies was a major challenge.

## Holding Value

Money is a measurement of value and a medium of exchange. It has become like a universal language; we just use it and take it for granted. 

That change is the result of money’s relative scarcity and the impact on money's value of the increase in its supply is called inflation.

When countries suffer from inflation, you see volatility in prices and monetary value. That’s why we shouldn’t take the stability of sound money for granted.

If the key to money holding value is scarcity, how does cryptocurrency achieve digital scarcity?

## Digital Scarcity

To be scarce, there must be a limited supply of the commodity, and it can’t be easy to replicate. This can be relatively easy to achieve and assess when we talk about a physical commodity, but digital is a different world.

Digital material can be copied easily and cheaply – just ask the entertainment industry – which is why cryptocurrency is not simply a file you keep on your hard drive. If it was, it could just be copied and copied and copied, reducing scarcity.

All forms of digital currency, whether crypto or fiat, rely on an accounting system based on [digital ledgers](https://knowledgebase.datagumbo.com/knowledge/what-is-a-digital-ledger), which are an organised record of debits and credits against account holders, providing a running balance.

This shouldn’t worry you. Almost all fiat money only exists digitally (ie, everything in your bank account), so it is a system you already trust.

As an example, [Bitcoin (BTC)](/coins/btc) as a cryptocurrency is also based on a digital ledger. The crucial difference is the rules around if/when/how much new money is added to the system and how the ledger is maintained. It is these differences that change everything. 

## Trust

We can only consider money useful if the ledgers can be trusted as accurate and honest and supply is controlled.

For fiat currencies this is dealt with by the relevant government managing the ledger for its currency, controlling the physical creation of the money and allowing credit and debit relationships between itself, the banks and the people.

It achieves this by having a central bank with allows select institutions, like banks, to keep their own ledgers. When you add up all the credit in all the records of all the institutions, including the central bank, you know the total supply of that currency.

There is then a consensus that the only books we trust are those kept by these institutions, and that they will be maintained properly. We collectively agree they will meet their obligations and the rule of law.

The traditional money systems are held together by this authority-based trust, and we can use our money online because we trust that banks won’t let people cheat and spend more money than they have. 

We have even trusted them to ‘create’ money, lending out more than the deposits they hold, and assuming risks for complex investment strategies.

Obviously, this is an oversimplification, but the general principles rely on trust. While it generally works, there are weaknesses – for example, money in a bank may be yours, but isn’t strictly in your control.

In addition, a single central point of failure is more vulnerable to corruption, manipulation and external pressure, opening the door to abuse, mismanagement, and economic exclusion.

The most worrying feature of fiat, though, is how it undermines scarcity.

## Money Supply

Economic activity creates value, and that means new money must be introduced to allow the economy to grow. To oversimplify again, new fiat money is created by commercial banks, overseen by the central bank.

Common ways of this happening are:
- Providing credit, like loans, to new customers that become deposits 
- Buying existing assets, which become deposits
- Providing overdraft facilities, which are deposits that can be spent

Getting the rationing right is a delicate balance; create too little money and spending slows, create too much and the value is diluted, putting prices up. This, in effect, is inflation.

This means human institutions are ultimately in charge of money supply, which in turn means there’s no real scarcity. To many, this means fiat currencies, by definition, cannot be considered sound money.

Centralised systems can be vulnerable, but, had been, arguably, the only way to make a secure digital money, but not a sound one. Then along came bitcoin, using this approach from the very beginning.

Guide to Crypto Scarcity and Trust

The term “Metaverse” is all over the place at the moment; in the news, on social media, and even at the dinner table. The Metaverse, which serves as a link between the real and virtual worlds, is expected to grow rapidly in the coming years.

Here we look at the five Metaverse crypto coins tipped to be big in 2022. Read on!

## [Decentraland (MANA)](/coins/mana)

Decentraland, founded in 2018, had a significant head start in the Metaverse race. It is a leading Metaverse project built on the Ethereum blockchain which provides a virtual gaming experience to users worldwide.

Users can create and customize their characters, interact with other users, and explore the ever-expanding Decentraland universe. It is widely tipped as one of the best web 3.0 crypto coins to invest in this year.

Decentraland is unique as the first decentralized virtual reality system allowing users to communicate and interact with one another while also granting ownership of virtual land in the Decentraland metaverse.

In terms of investment, Decentraland has its cryptocurrency, MANA. Importantly, all transactions within the Decentraland game must be executed in MANA – giving the real token utility. Some of the most profitable transactions involve the purchase of virtual land and real estate, which frequently sell for more than a million dollars.

## Sandbox (SAND)

The Sandbox is a virtual gaming world where users can create and monetize gaming experiences. It is a popular platform, with a hundred sales completed every minute. Within the Metaverse, players can use SAND tokens to buy digital goods and participate in P2E. They also truly own anything they collect in the game.

The Sandbox is where users can create, earn, and trade in-game items. The Ethereum blockchain-based platform includes buying virtual land, buying virtual land, and building real estate, similar to Decentraland. After that, the property can be sold on the open market. The Sandbox, built on Ethereum blockchain, like Decentraland, has its native digital currency – SAND.

## [Axie Infinity (AXS)](https://axieinfinity.com/)

Axie Infinity, a metaverse crypto gaming pioneer, is an in-browser game featuring Axies. These Pokemon-like creatures are NFTs that can be purchased, bred, and traded. Non-gamers are drawn to the platform by the game’s virtual real estate. Players can use the AXS currency to make in-game purchases, stake their coins, and participate in community governance.

The Axie Marketplace is one of the industry’s most active. A single transaction in the game costs around $420 on average.

## [Enjin Coin (ENJ)](/coins/enj)

Enjin is the next on our list of Metaverse crypto coins. Enjin, founded in 2017, provides a globalized database that enables users to manage and store digital gaming products safely and securely. Furthermore, the platform streamlines buying and selling NFTs through a user-friendly mobile app that includes QR codes.

There’s much interest in Enjin Coin, especially following rumors of a Samsung partnership that saw ENJ prices skyrocket. Microsoft is also collaborating with Enjin to develop Azure Heroes, a program for acquiring digital collectibles. In addition, Enjin recently announced the creation of the $100 million Efinity Metaverse Fund to support its ecosystem partners.

## [Gala (GALA)](https://app.gala.games/)

Gala is a blockchain gaming platform founded on July 21, 2019, by Eric Schiermeyer. It combines Non-Fungible Tokens (NFT) to create a blockchain game ecosystem in which players can trade and own game assets at any time on a global scale. Gala Games’ goal is to take the gaming industry to a whole new level by giving players back control of the game. According to the platform’s website, Gala Games’ goal is to create “blockchain games you’ll want to play.”

GALA’s innovative gaming features are complemented by a strong emphasis on social media and community building. The team is dedicated to providing a fun and supportive environment for gamers to come together and share their passion for gaming. As a result, GALA is poised to become one of the leading platforms in the metaverse space, thanks to its unique gaming and social media features.

Metaverse projects are sprouting almost everywhere, but some have real potential and stand out. The ‘Metaverse’ concept is embedded in blockchain and cryptocurrency, so investment opportunities exist. Furthermore, the buzz surrounding NFT appears to be growing.

Remember, if you choose to invest, don’t put all your money into a single type of Metaverse crypto coin. Instead, diversify and, more importantly, purchase coins that you have researched and believe have potential.

This is a guest article by Brendan Beeken, find the article [on Brendan Beeken's website.](https://brendanbeeken.com/metaverse-crypto-coins-2022/)

Guide to the best Metaverse crypto coins

The pattern created by the ever-changing price of a cryptocurrency asset can be an indicator of what could happen next. The fluid prices, which reflect the sentiments of buyers and sellers, can be seen in a price chart.

Your challenge comes, as a trader, when you try to understand and interpret the information of the price chart and use it as part of your technical analysis to try and predict the direction of value.

## The Basics

Looking at a price chart in its most basic form, you will see a line graph on two axes illustrating price history for trades conducted between a specific pair of currencies.

Trading pairs are offered against base currencies - currencies which are the most liquid. As there are thousands of cryptocurrencies, enabling trading pairs between all of them and all fiat currencies would be impractical. Instead, exchanges offer trading against base currencies which are generally:

- Major Fiat currencies
- [Bitcoin](/coins/btc)
- [Ethereum](/coins/eth)
- Major Stablecoins 

Common trading pairs you may see include:

- EUR/BTC - Euro to Bitcoin trade
- USD/BTC - US Dollar to Bitcoin trade
- BTC/EUR - Bitcoin to Euro trade
- BTC/LTC - Bitcoin to Litecoin trade
- USDT/BTC - Tether to Bitcoin trade (Tether is a stablecoin)

When you watch a trading chart you will see what the price is at that moment for the chosen pair. It will turn green as it goes up, and red as it goes down. 

The chart is relative to the context of the specific trading pair and the key elements you will see include:
- The currency pair it relates to
- The x-axis which is a time scale
- The y-axis which is a linear value scale e.g USD
- Price plots, which are generated over time producing a line chart and spot price

The movement depicted in the chart is specific to this currency pair.

## Logarithmic Scale

Dramatic changes are visible when you look at an asset’s price changes. Switch to a log scale, where the Y axis plots two equal per cent changes as the same vertical distance on the scale, and you get a different perspective.

## Time and Candles

Remembering the difference between trading (short-term decisions) and investing (long-term positions), you need to decide what timescale you are operating in.

A chart will let you change the timescale it reports on, so you can look at a short period, for technical analysis, or a longer period. 

For a more detailed view of price movement, you will need [Candlesticks](https://crypto.com/university/how-to-read-crypto-candlesticks) (or Candles – so named because of the shape). Through four key elements - the top and bottom of the candle body and a wick (thinner line) above and below - a simple line plot is fleshed out with much more detailed information about what happened to price over a period, rather than the single plot.

## Price Direction

For easy reference, a green candle shows a price went up during the chosen period while red indicates the price fell.

This means a quick glance can, thanks to the colour, show you price direction. However, you got this with the simple plot chart, so what’s the benefit? Candlesticks fill in the gaps of how prices oscillated during the period.

**The Opening Price** - Each candle will tell you where the price opened. If the price increased during the chosen period, the Opening Price is shown by the bottom of the candle body. If the price fell, the Opening Price is at the top of the candle body.

**The Closing Price** – The reverse of Opening Price. If the price fell during the chosen period, the bottom of the candle is where the price ended for that candle duration. If the price rose, the Closing Price will be at the top.

**The Highest Price** – You want to know how price moved, by knowing the highest point it reached. This is shown by the tip of the wick at the top of the candle. Where price has increased over the period, the wick will extend from the Closing 

**Price** - top of the candle body - to the highest price reached.

**The Lowest Price** – As you’d expect, this is the converse of Highest Price, showing the lowest price that was reached with a wick extending from the bottom of the candle.

**Candle Duration** – In the trading charts that are interactive, you can zoom in and out to look at different periods of time.

As you look at the candlesticks more, you’ll begin to understand what they are telling you. Basically, the longer a candlestick, the more the price has moved during the period you are looking at. The longer the wicks, the greater the range of movement, known as Volatility.

Looking at price movement with the aid of candlesticks is a step toward technical analysis, giving the first layer of detail of price signal and pattern. 



Understanding Crypto Price Charts

Simply put, you need to invest time in cryptocurrency trading. The more you analyse, read, learn, and trade, the sharper your skills will become.

You need to allow time to research before making a decision, and the demands on your life may dictate what sort of trader or investor you become. If you have a full-time job, family, and active social life, be honest with yourself – do you have the time to do the necessary research and monitor your trades?

In cryptocurrency, the volatility of markets can mean you are under constant pressure and need to dedicate huge amounts of time.

## How Much?

The simple rule when it comes to decide how much to trade is ‘how much can you afford to lose’.

Before you decide how much to allocate, consider these rules:

- Never invest money you can’t afford to lose
- Don’t invest using a credit card or debt
- Don’t rely on unqualified trading advice
- Commit only a small proportion of your discretionary income
- Be prepared to see your investment decline
- Have an idea of what you are trying to achieve

Discretionary Income is the money you have left over after income tax and essential living expenses are covered. It is money you might choose to invest or save. 

There’s no rule on how to allocate this money, but common sense dictates the risk should be spread, with the largest proportion in the least risky area, such as savings. The smallest proportion should be allocated to the most-risky venture.

There is, of course, volatility and risk in cryptocurrency, so take that in account when considering the allocation of your discretionary income.

## Clear Objectives

It seems obvious, but have you asked why you are trading? No, to make money isn’t a good enough answer. Think about it; there are other ways to use your money to make a return, so there needs to be justification for the comparative risk of cryptocurrency trading.

When you have conducted your research, you may conclude that crypto can be considered a sounder investment than some fiat currency savings accounts. That means comparing cryptocurrency trading against non-fiat opportunities ranging from precious metals to property. Often, there is less risk here than in crypto.

After all this, you may conclude that crypto is the best place for your discretionary income with the risks measured and the potential rewards considered. This will help you to quantify your ambition. 

## Cost Averaging

Cost Averaging simply refers to making equal, regularly recurring trades, instead of a lump sum.

Some enjoy that cost averaging can mitigate concerns about volatility and choosing an entry point, as regular trades over time will smooth the ups and downs. Fundamental Analysis is important to help you make a judgement about the long-term viability of your chosen cryptocurrency asset. After that, your investment path is mapped out.

That said, cost Averaging works best when carried out over a period long enough to benefit from both a down cycle and an up cycle. And it is not risk free; over that time you will see the investment level fall, possible below what you initially put in, with on guarantee it will recover.

Thorough Fundamental Analysis will help you assess if you are prepared to take the risks associated with regular purchases, such as seeing your investment declining over an extended period.

## Technical Indicators

Once your Cost Averaging routine is established and you are comfortable with how it works and keeping records, you can consider using technical indicators to adjust your regular investments.

The aim is to adjust down your allocation at times when the market is overbought, and vice versa.

There are plenty of indicators to help you with this, so do your research. Standard charting tools, like Moving Averages, Relative Strength Index (RSI) or Bollinger Bands, can be used and you might look to an external indicator to inform the adjustments which you feel correlate with price, such as the US Dollar Index (DXY). 

You can use any model or indicator you choose, depending on what value you feel it has.

## Lump Sum Hodling 

When you start with Cost Averaging you may gradually move into trading-type decisions. There are drawbacks; it takes time to build a position, for example. You may instead choose to invest a lump sum rather than drip-feeding via Cost Averaging.

Both require Fundamental Analysis. However, given the increased exposure you have with a lump sum, please ensure you have done your research on top of following the normal golden rules.

Fundamental Analysis becomes even more relevant if you are committing a significant amount of savings. 

If you are happy with the decision to go with a passive long-term investment, following Fundamental Analysis, you still have to decide price entry point.

Technical Analysis can be used to decide an optimal point to make the lump sum purchase - using Technical Indicators as described above. 

Simple Crypto Trading Strategies

For many, cryptocurrencies are considered too volatile, especially when compared with traditional fiat currency. Fiat is a benchmark for pricing, a medium which can be used to buy and sell things. That is where [stablecoin's](/news/tag/stablecoin) come in.

A stablecoin offers the stability of fiat, combined with the borderless, peer-to-peer benefits of cryptocurrencies, as well as the full transparency of their movement.

This creates a unique bridge between the traditional economy and the growing crypto world, and that is why the national banks of many countries are considering their own digital currencies based on the stablecoin model.

[Central Bank Digital Currencies](/news/article/cbdc-uk) don’t fix the problems of fiat, especially the chief weakness of there being no cap on supply.

## What is a stablecoin?

An attempt to deal with the inherent volatility of cryptocurrency, the clue to a stablecoin’s purpose is in the name – stable.

They aim for stability by tracking both asset and currency values, alongside a specific fiat currency value, making a stablecoin as stable as the currency it tracks, and the mechanism used for the relationship with the underlying currency.

The most common currency used by stablecoin is the US Dollar and the first and still the biggest, stablecoin is Tether. 

Since it launched in 2014, more stablecoin's have followed, including ones based on the Euro, British Pound and Australian Dollar, as well as more volatile currencies like the Brazilian Real.

## Why are they useful?

Cryptocurrencies are volatile, with huge value changes possible day to day. To explain this, let's use [Bitcoin (BTC)](/coins/btc) and the Euro.

Imagine instead of buying your morning coffee for €4 every day you switched to paying by Bitcoin. As the price is constantly changing, the cost of your daily coffee would constantly change, sometimes up, sometimes down. This daily volatility isn’t seen with the Euro.

While over the long term the price of the coffee may actually work out less than you would have paid in Euros, that’s not much help when you need to budget day to day. Stability is necessary and uncertainty over price could see people spend less, causing economic damage.

The lack of uncertainty over price is a reason why many people are unwilling to spend or accept cryptocurrencies, preferring the predictability of fiat.

However, that doesn’t make fiat perfect. When you put your money in a bank, you lose control of it. If you want to transfer money across borders, you could face huge fees and delays. You may not have access to banking, or live in a nation with high inflation, removing your link to a stable fiat currency.

This is where stablecoin's become useful. They bring together the stability of fiat with the decentralised, global characteristics of cryptocurrencies.

## How do they work?

Just like any other cryptocurrency, stablecoin's are entries on a global shared digital ledger that can be transacted on decentralised, peer-to-peer global networks. 

Most run on established blockchains, like Ethereum, enabling stablecoin's to be launched relatively easily. There’s no real difference between trading ether (ETH) and an Ethereum-based stablecoin.

Stability is at the core of this offering, and there are different ways of achieving that. For example:

- Fiat collateral-based
- Crypto collateral-based 
- Algorithmic-based seigniorage
- Central Bank Digital Currencies (CBDCs)

## Fiat collateral-based stablecoin's

The first model to be used, the most prevalent and the most straightforward way to achieve stability. This method makes each unit of the stablecoin a representation of a unit of the fiat in the bank.

This means that each unit of this type of stablecoin is just a representation of an existing unit of fiat currency in its issuer’s bank account, and the supply is dictated by how much is on the bank account. If new stablecoin units are to be issued, more fiat must go into the bank.

This type of stablecoin can be based on commodities other than money, such as gold and silver.

Examples of this type of model include Tether, [Gemini](/news/article/gemini-crypto-review), [Paxos](/news/article/circle-paxos-crypto-approval-singapore), and TrueUSD, all matched with the US dollar, Digix, which is backed by gold, and Globcoin, which is based on a basket of currencies.

## Crypto collateral-based stablecoin's

The consolidation of crypto markets has paved the way for a class of stablecoin collateralised entirely on crypto assets.

It uses smart contract technology, reducing reliance on companies and human behaviour, to create a purely on-chain stablecoin based on the value of the underlying cryptocurrency (or cryptocurrencies).

Unlike fiat-based stablecoin's, this type requires over-collateralised deposits so that any fluctuations in value of the underlying crypto don’t cause an issue.

DAI was the first and crypto collateral-based stablecoin.

Initially, Ether (ETH) was the only cryptocurrency accepted as collateral, but later crypto collateral-based stablecoin's have adopted a multi-collateral approach, which means can deposit many other Ethereum-based tokens as collateral.

## Algorithmic-based seigniorage stablecoin's

In this model, the stablecoin tries to mirror the traditional central bank mechanism, but using smart contracts that try to adjust supply in circulation based on demand for the currency.

It tries to maintain price levels by issuing more tokens when demand is high, via interest-bearing shares, and removing tokens when demand falls, using a system of redeemable bonds and automated buybacks.

As the expectation is that the mechanism will keep the stablecoin stable, this model does not have an underlying asset, unlike collateralised models. However, this is an experimental and largely unproven concept, and has attracted negative attention from regulators.

Very few projects exist, such as Bdollar, and usually with limited circulating supply.

## CBDCs

As cryptocurrencies become viable and an efficient alternative to traditional payment systems and start to be used in more areas of the economy, winning over ever more sectors of the economy, it’s inevitable governments will want to get involved.

This is where we see central bank digital currencies. CBDCs are not cryptocurrencies or stablecoin's, but include features of both. They are stable, as a re-engineered form of a national currency, and include elements you’d see in cryptocurrency.

Think of them as a hybrid of a cryptocurrency, like bitcoin, and a fiat currency. Most CBDC proposals use a blockchain or other distributed ledger system (DLT) to keep a single ledger of payments and transactions, like crypto. 

This allows greater efficiency and gives the central bank a single ledger to account for money supply while also reducing reliance on commercial banks for issuing new money into the economy.

As they come online, CBDCs are expected to be permission networks – unlike the open nature of true crypto networks – as governments don’t like to give up control. This means validation of transactions will likely remain with regulated bodies, possibly including the private sector.

Again, unlike crypto, money supply and monetary rules are likely to stay controlled much like fiat currencies today are, albeit with more direct control by the central bank.

It is still too early to know too much for sure with CBDCs and, in the meantime, stablecoin's do a good job of bridging the gap between fiat and crypto.

## The Future

Stablecoin's are a fast-growing type of cryptocurrency and without the price stability they bring, it would be hard for cryptocurrencies to offer complex financial instruments, like loans, and become a bigger part of the global economy.

There remain challenges to cryptocurrencies becoming part of the mainstream, including regulation.



What are Stablecoins?

You need to take care to avoid becoming the victim of crypto cons, and a new alert has been issued about visiting popular websites.

The [Washington Post](https://www.washingtonpost.com/) has warned that slightly misspelled versions of the URL, or website address, of popular cryptocurrency exchanges are being snapped up and could be used by scammers. The aim, it seems, is to take advantage of people who want to access a genuine site, but type too quickly and make a mistake.

## Misspelt URLs- Watch Out

It points to a Brazilian man who paid more than $200,000 for a handful of domains which looked like misspelt URLs of well-known crypto sites.

The article, by [Jeremy B. Merrill](https://www.washingtonpost.com/people/jeremy-b-merrill/), adds: ‘The high price paid for the web addresses, sometimes called domains, indicates someone thinks they’ll make a substantial profit. Domains ending in dot-com cost around $10 per year and scammers often rely on ones that are even cheaper.’

It quotes Stony Brook University computer science professor Nick Nikiforakis as saying: ‘There’s a very real monetisation opportunity. If someone steals your credentials, they can immediately start transferring your money out of your account.’

Merrill’s article continues: ‘And, if they do, users have no recourse, Nikiforakis said, especially because they’ve lost cryptocurrency, rather than regular money. Cryptocurrency, a form of digital money that has lately soared in price, relies on cryptography to make sure that only the owner of a “wallet” can spend the money it contains. But, once that wallet is stolen, that security works to protect the thief, meaning it’s nearly impossible to get it back — even with a court order.’

##  The Real McCoy

The Washington Post admits that it is unclear whether cryptocurrency owners have lost money to the typo websites. However, some of the websites hosted on URLs which appear to be typos of genuine crypto companies do mirror the look of the real McCoy.

The article observes that companies often buy up mistyped versions of their real web addresses to protect users against potential attacks.

Nikiforakis evaluated one of the typo URLs at The Washington Post’s request and said it ‘showed tell-tale signs of a “phishing tool kit” that provides a ready-made way to spoof common websites’.

The article adds: ‘Nikiforakis believes that such expensive domain names could be using spearphishing — a phishing campaign aimed at a small number of handpicked people. “You’re not going after me and you with a few hundred bucks in your accounts, but people with millions of dollars in their crypto accounts,” he said.

‘That contrasts with the typical business model for phishing attacks, which tend to use large numbers of cheap domains, to minimize the costs of detection. “If I buy a .xyz \[domain\] for one dollar and I can make two dollars by the time someone blocks me, I’m ahead,” he said.’

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