IIn 2021, people couldn’t stop talking about cryptocurrencies. 2022 will be no different.
Interested in encryption It thrived, with trading apps like Robinhood And urinate and payment platforms such as Venmo And cash app Allowing anyone with a smartphone to buy and sell BitcoinEthereum and more. The internet is full of chatter about volatile prices – especially record highs – and more and more companies are starting to do so Accept crypto as a method of payment.
Money has a complete guide on what cryptocurrency is and how it works. But the crypto world is moving fast.
Here are 5 cryptic buzzwords you’ll likely hear in 2022, and what they mean.
Bitcoin, the first cryptocurrency, was created in 2009. Since then, it has amassed a market capitalization of $925 billion, paving the way for the emergence of alternative cryptocurrencies, or alternative digital currencies. Today, some experts say that altcoins like Ethereum, Cardano, and Solana already have more functionality than Bitcoin (like running DeFi apps – we’ll get to that later) which could make them more valuable in the future.
Stable coins, another type of altcoin, have a value tied to an external asset such as gold or the US dollar. Then there are meme coins, which serve little purpose, but are growing in popularity because people think they are funny or cute.
“People love to gamble, as long as the market is hot, I think there will always be a place for that,” Daniel Polotsky, founder and senior advisor at Bitcoin ATM CoinFlip, says of the meme.
There are more than 15,000 cryptocurrencies in circulation, according to CoinMarketCap, and more are being developed every day.
It’s hard to explain what Web 3.0 is, because the definition is worked out and reformulated in real time. But since people can’t stop talking about it, nothing here.
The general idea is that Web 3.0 is a version of the Internet where people own their digital possessions, and control their data, without having to go through intermediaries like Facebook and Google.
First, there was Web 1.0, the original version of the internet with static sites (remember GeoCities?). Then Web 2.0 came along, with Amazon and Twitter and all those other websites coming in to make the internet more user-friendly. Web 3.0 is all about taking back some power from those tech giants.
2022 will be an important year for Web 3.0, as new products that support crypto-enabled web interactions emerge, says Nick Casares, chief product of Polyient, an investment group focused on virtual economies. Casares says products like Compound and Aave, which provide encrypted access to financial products via DeFi or property ownership via NFTs, are poised to become a leader in the march toward the so-called new internet. (Don’t worry, we’ll touch on some of those buzzwords below.)
Cryptocurrency wallets allow you to store the secure digital tokens required to interact with the blockchain – the ledger that records all cryptocurrency account balances and transactions around the world. In other words, you need one if you want to buy and sell cryptocurrencies.
Some cryptocurrency wallets are called “hot wallets,” and they are connected to the Internet and can be easily accessed through a phone or computer. On the other hand, “cold wallets” are offline, and live on a piece of hardware (similar to a thumb drive) or even on a piece of paper. Which crypto wallet will work best for you depends on a few factors, including whether you are a beginner and whether you want to trade Bitcoin or any other cryptocurrency.
Are you still with us? Money has a guide to the best cryptocurrency wallets, with plenty of additional information on exactly how these things work.
Decentralized finance, or DeFi for short, refers to a variety of financial products that can be accessed directly over the blockchain network so that users do not need to go through brokerages or other intermediaries.
DeFi advocates argue that creating a direct line between the consumer and those products — rather than making them go to a big bank when they need a loan, for example — could lower costs and make transactions faster and safer.
There are certainly risks. DeFi mimics the highly regulated services in the traditional financial ecosystem, but does so without the same regulations, says Ben Cruikshank, president of Flourish, a fintech platform that recently launched its own cryptocurrency offering. Fraud outbreaks: In November, blockchain analytics firm Elliptic found that losses on DeFi platforms due to theft and crime amounted to $10.5 billion in 2021.
You may have heard of non-fungible tokens (NFTs) by now. In 2021, the NFT craze prompted buyers to pay over thousands of dollars for LeBron James’ digital art dipping basketball and animated cat With Pop-Tart for the body.
So what exactly is NFT? It is a cryptocurrency innovation that allows someone to own digital property. In addition to art, “NFT” can be used to describe a wide range of assets such as music, games, titles (for real-world items such as title deeds) and credentials such as diplomas and certificates, Casares says.
This craziness is sure to bleed into the new year, especially now that celebs are so loving Martha Stewart, and companies like Coca Cola, they have fun. As with most cryptic things, it’s impossible to know if the NFT mania is a fad or a perpetual trend, but the attraction is definitely increasing.
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