In this article, we will continue to tell you about the specifics of cryptocurrency.
Questionable sources
If you are engaged in trading in cryptocurrencies, it is important for you to be able to find news on the assets that interest you. As a rule, the main information is published on the websites of companies and social networks. Also, a lot of useful information can be found on the forum https://bitcointalk.org/.
As for the other sources - analysts, experts, or even neural networks that analyze the cryptocurrency market - only you can decide how much you should trust them. Perhaps these are really reputable traders or investors who know cryptocurrency and blockchain industry, or maybe accounts of fraudsters with purchased subscribers. In addition, fraudsters can hack someone else's account to publish the information beneficial to them.
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Be careful and check back all the news, as well as pictures with technical analysis, if you want to use it. You should also understand that even if Satoshi Nakamoto says “I’m sure that the Bitcoin rate will increase to $ 1 million in the coming year” — these are only his personal expectations and forecasts that may or may not be fulfilled.
Scam
So called failing cryptocurrency projects. It can be:
Fake projects are projects with loud promises that do not carry any useful ideas; the task of which is to collect clients’ money and close down. No work is actually being carried out and the product is not being released. Creators can simply hide, or refer to a hacker attack or other external circumstances.
Bankruptcy of the real project. For example, the main idea of the project was not viable, or there were disagreements in the team, or other problems that were not be overcomable. As a result, tokens depreciate and thus it is already impossible to sell them. Sometimes the administration of the project honestly announces the reasons for the closure and the funds (or some of them) are returned to investors.
The risk of scams is especially high during the first year of the project. If you participate in ICO or invest in new cryptocurrencies or tokens of new companies, carefully study the projects:
Rate the main idea and its relevance.
Pay attention to the team of the considering project and to the previous projects of its developers.
Examine the White Paper, check the uniqueness of this documents.
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Delisting
The cryptocurrency market and the blockchain industry as a whole is a very young market with advanced technologies, so a lot is changing. Bitcoin is not yet 10 years old, many governments have no official policy on cryptocurrency, but thousands of blockchain-based projects have already been launched, and thousands of projects have already failed.
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In the event of a project failure, as well as for some other reasons (for example, very low trading volumes, technical difficulties), the exchange may exclude cryptocurrency from the list of assets. This exchange warns in advance so that you can sell an asset or transfer it to another wallet. However, if you prefer long-term investments, and you are not monitoring the news, or you don’t often check your account and do not read any mail from your exchange, you will certainly lose your money.
e.g. Poloniex had delisted some coins, including EMC2, FLDC
Forks
The term "fork" - a term from programming, means using the source code to create another project.
There are two types of cryptocurrency forks — softfork and hardfork. Softfork — a small adjustment of the cryptocurrency code without making fundamental changes to it. Hardfork involves major improvements in the source code, making the new version incompatible with the old one. Both blockchains — the one that is created after hard forks on the new version of the code and the one that is created on the old version, can exist in parallel.
Forks are performed if a vulnerability is detected in the source code or to improve the system performance:
Segwit Softfork is an update implemented on the Bitcoin network in August 2017. Due to the growing popularity of cryptocurrency and the increase in the number of transactions in the network, the number of operations has dramatically increased, and the Bitcoin network could not cope with the load. As a result of the SegWit update, the structure of data storage in the block and the transaction verification mechanism changed, which increased throughout and solved some security problems.
Bitcoin Cash (BCH) — Bitcoin hardfork held in 2017. In Bitcoin Cash, the block size is 8MB, which is 8 times larger than that of Bitcoin. This made it possible to increase network bandwidth and reduce the amount of transaction fees.
Litecoin (LTC) is one of the first bitcoin hardforks. Charles Lee forked it in 2011. The mining mechanism of litecoin and bitcoin is different, in addition, new blocks are formed more often, and the planned emission is 4 times more coins than in bitcoin.
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There are also many less successful forks of Bitcoin and other cryptocurrencies, some of which have already ceased to exist.
The cost of cryptocurrency is growing in front of the hard forks, because with hard forks, usually the coins of the new cryptocurrency are distributed between the holders of the old version of the coins with some proportionality factor. That is, if you had 1 BTC at the time of forks of Bitcoin Hot (BTH) and BitcoinX (BCX), then you would have an additional 100 BTH coins and 10,000 BCX coins.
Attention: If you want to get new coins with hard forks, make sure that your wallet or exchange supports this fork.
Airdrop
We have written many warnings for you, and at the end of the article we want to say something pleasant: there is an opportunity to get cryptocurrency for free, even without having initial capital.
Blockchain startups sometimes arrange Airdrop — free distribution of their tokens. Airdrop is conducted to tell the crypto community about its existence and to attract potential users to the project. Those who want to receive tokens should perform various simple tasks, depending on the requirements of the project, for example: subscription, reposts in social networks and the like.
The amount of remuneration is usually equivalent to $ 5–15. Often, Airdrop programs are combined with referral ones, that is, not only you are getting project tokens for free, but you can earn even more if other users register with your link. Also, many blockchain projects launch bounty programs with more serious tasks and greater rewards.
There are many telegram channels and special sites that publish information about current Airdrop programs. Often, their owners place their referral links to participate in programs and earn from this.
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Some of the tokens obtained at Airdrop are traded on exchanges and can be sold immediately, others will be traded later, and some never. It may be a good strategy not to sell tokens at once, but to leave them for a few months — some of them may increase in price dozens of times, while the other part is likely to depreciate.
When participating in such projects, do not forget about security:
Do not download or open files from questionable sites — these could be malware.
Do not specify the secret key of your wallet, passwords and seed phrases — this gives you full access to your wallet, not a single normal project will ask you for this information, only intruders.
If you are asked to deposit some amount of money to receive coins, then it is not Airdrop. The advertising campaign provides for free distribution in response to your actions.
If you have doubts about security, it is better to refuse to participate in this Airdrop program.
Thank you for your time!
>>> That was the second part of this article. You can read the first part here: bit.ly/2E0XK80
#education #general #twimtrade #cryptocurrencies #questionablesources #scam #delisting #forks #hardfork #softfork #airdrop #twim
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