What is Virtual Currency and Most Popular Cryptocurrency - Appy Pie

Virtual Currency [Definition, Pros, Cons, and Popular Cryptocurrencies]

Abhinav Girdhar
By Abhinav Girdhar | Last Updated on April 23rd, 2024 6:28 am | 5-min read

Virtual currency has been growing at an explosive rate. Nearly every day new virtual currency emerges, old die, early adopters get wealthy and investors lose money. According to a report released by the Bank for International Settlements (BIS), the number of people who own virtual currencies has increased to more than three million worldwide. As per them, a growing number of people are using virtual money as an alternative to regular currencies and the trend would continue in the years to come.

In this article, we’ll discuss what virtual currency is, advantages of virtual currency, disadvantages of virtual currency, important cryptocurrencies, and NFTs – the cryptocurrency of 2022.

What is Virtual Currency?

Virtual currency is a digital representation of value that functions as a medium of exchange, a unit of account, or a store of value, but does not have legal tender status (i.e., when tendered to a creditor, is a valid and legal offer of payment) in any jurisdiction. The reason for the popularity of virtual currencies is that these currencies allow for transactions to occur without the need for a financial institution that acts as an intermediary such as PayPal or a bank. This means that users of virtual currencies can bypass banks, credit card companies, and other financial institutions. All payments through virtual currencies are transparent and can be monitored on a blockchain. Blockchain is a shared public ledger where all transactions are recorded in real-time. The data being stored on the blockchain is protected with cryptography and validated by the network of computers that make up the blockchain network. Bitcoin is one example of a virtual currency that has been in wide use since 2009. Bitcoin is a digital asset designed to work as a medium of exchange that uses cryptography to control its creation and management, rather than relying on central authorities. Bitcoin can be converted to fiat currencies whether you are holding in Bitcoin IRA or your cold storage, such as the U.S. dollar, or other cryptocurrencies, which can be exchanged back into U.S. dollars or other fiat currencies.

Advantages of Virtual Currency

Virtual currency is a digital form of currency that is designed to work exactly like physical currency. It can be used to buy things or exchanged for other currencies, such as the standard U.S. dollar. The rise of virtual currency has seen it become an increasingly popular form of payment for goods and services online. Here are some of the biggest benefits of using this secure, easy way of paying:

  1. User-Friendly

    The user experience on virtual currency-based websites has improved dramatically since their inception. The early models were clunky, hard to navigate and difficult to understand. These days, the entire process is much smoother and much more user-friendly.

  2. Security

    Since virtual currency is digital, it is much more secure than physical money. There's no worry about someone stealing your wallet and emptying your bank account or about a debit card being compromised and being used for nefarious purposes by someone else.

  3. Acceptability

    Virtual currency isn't just accepted by small-scale businesses; big companies have been using it for years too. Some mobile phone carriers have been accepting virtual currency since 2011, and almost every major retailer accepts some form of virtual currency these days.

  4. Low Cost

    Transactions made with virtual currency are usually free or carry very low fees when compared with other common forms of payment, such as credit cards or PayPal transactions. This makes this payment option extremely appealing for users who want to save money as well as merchants who are looking to reduce their processing costs as much as possible.

Disadvantages of Virtual Currency

While virtual currency holds many pros over traditional forms of payment, there are a few cons or drawbacks that go along with it as well:

  1. Volatility Issues

    The biggest disadvantage to using virtual currency is volatility—that is, its tendency to fluctuate in value frequently. In a matter of hours, the price could go up or down dramatically, and there's no telling what the future holds either.

  2. Lack of Regulation

    Without regulatory oversight, there are no guarantees when it comes to virtual currency transactions either in the U.S. or internationally where many different countries operate on different standards regarding exchange rates and consumer protection practices.

Most Popular Types of Cryptocurrency

Cryptocurrency is a digital currency that is completely decentralized and uses peer-to-peer technology by means of cryptography, hence the name. There are over 100 different kinds of cryptocurrencies out there in the world, but only a few are “major” cryptocurrencies. Below is a list of the top 5 most popular types of cryptocurrency in the world today.

  1. Bitcoin (BTC)

    Bitcoin was created back in 2009 and was the first ever cryptocurrency to be created. It’s often referred to as “digital gold” because of its high value in the market and its rarity compared to other cryptocurrencies.

  2. Litecoin (LTC)

    Litecoin is very similar to Bitcoin but much faster, cheaper, and more secure than Bitcoin. It’s also better for doing transactions in smaller amounts since it doesn’t have much fluctuation in its value like Bitcoin does.

  3. Ethereum (ETH)

    Ethereum was created in 2015 by Vitalik Buterin – a young Russian programmer who developed it as an alternative to Bitcoin. The Ethereum blockchain is essentially a massive worldwide computer which uses its own currency called Ether (ETH), and is used to pay for transaction fees, development tools and other services on the Ethereum blockchain.

  4. Ripple (XRP)

    Ripple is another major cryptocurrency out there in the world today that was released back in 2012 by Chris Larsen and Jed McCaleb – two very well-known names in the cryptocurrency industry who have also helped launch several other cryptocurrencies such as Stellar Lumens and Lightcoin.

  5. Dash (DASH)

    Dash is different from most other cryptocurrencies since it was designed specifically for use as a form of digital cash. Dash has incredibly fast transaction times making it one of the most desirable cryptocurrencies to use right now.

NFTs - The Cryptocurrency of 2022

With the advent of cryptocurrency and blockchain development solutions, the world is slowly but surely moving towards a decentralized economy. If you are someone who invests in cryptocurrency, then this year NFTs are the hottest trend. NFTs are a new type of digital asset that can be used as a tokenized representation of any physical object on the blockchain. They can’t be duplicated or counterfeited. This means that each token is unique, just like a real-world object.
This lesson is a part of a more elaborate course on Academy by Appy Pie. To access the complete course, please Click Here. Lately, NFTs have been attracting a lot of attention not only in the world of blockchain but also in the gaming industry. People are going crazy over NFTs and doing everything to get hands on some highly rated NFTs like NFT Squeezie, Bunny Buddies NFT, Wonder Pals NFT, Radhe Shyam NFTs, Kurtis Conner NFTs, and many others. If you are going another way around and planning on creating your own NFT collection, then no-code development platform Appy Pie can help you out. Using Appy Pie NFT generator, you can make your own NFT collection of 1000 NFTs without any coding or designing skills in just a few minutes. So, no need to rely on any other NFT programming tool, simply visit Appy Pie NFT Generator and make NFTs easily and efficiently, without any hassle.

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Abhinav Girdhar

Founder and CEO of Appy Pie

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