The year 2020 will be mostly known for bringing about a global pandemic that no one could ever imagined it ravaging the world the way it did. Businesses shut down, schools closed, social distancing and masks became the new norm. People spent their time indoors, quarantined, waiting for the seemingly never ending to finally be over. Yet here we are in 2022, the light at the end of the tunnel is there, but we have awhile to go before reaching it. But just like COVID burst onto the scene in 2020, so did cryptocurrency.

What exactly is cryptocurrency? Cryptocurrency, also known commonly as crypto, serves as a means of exchange that is exchanged through a computer network. It doesn’t rely on a bank, government, or any asset for its backing, and their scarcity determines their value. Investing in something digitally with no backing seems completely risky and a reckless way to use your money, as investing in it leaves you vulnerable to hackers right? That isn’t exactly the case however. Cryptos use blockchain technology to safely secure users’ data. These blockchains log each transaction, which are then verified by peer-to-peer computer networks, then time stamped, and finally added to a list of data. This list of data keeps growing with each transaction. Your investments are secure because once the transaction goes through the process of blockchains, it makes your data unable to be altered, protecting it from hackers and other threats. It should be noted though, that not all blockchains work the same, and some can be hacked, but generally your investments are safe.

Although your investments are generally safe from hacking, there’s some risk involved. Crypto works similar to stocks in that there’s only a set amount of them are in circulation. In addition to scarcity, competition, and regulation also effect a crypto’s value. Its popularity boost over the last few years has propelled it into the public spotlight, skyrocketed values of well known cryptos such as Bitcoin, Ethereum, and Litecoin among others. Cryptos such as Dogecoin which originally started as a joke, has seen its value increase tenfold, thanks to SpaceX founder and Tesla CEO Elon Musk. Musk began tweeting about the crypto in early 2021, when its value wasn’t even remotely close to being 1¢. It slowly started gaining traction in April 2021, then shot up to over 30¢ by the end of the month. Within the first week of May, it reached its peak at 74¢. It has sense dropped to only 15¢, but it was never meant to reach that price to begin with. Something that started as a joke, became something much bigger than that.

Cryptocurrency has existed since 2009, with Bitcoin being the first known form of it ever created. As it currently stands, Bitcoin is the world’s most popular cryptocurrency and seems to be heading that way for a long time. But on January 24, 2022, the currency was selling for an almost all time low, around $33,000 a coin, slashing its all-time high of $69,000 in half and then some. It’s currently on a bit of a rebound, and could see a spike soon. Bitcoin isn’t the only crypto to see a dip in its price as almost every other crypto on the market has seen some sort of a drop as well. Since its dip, Bitcoin has been on a path to recovery, with its price steadily climbing to a solid $45,000.

Crypto has been around for a short time, so it’s yet to be seen if it can be sustainable. It offers a fresh, new alternative to the paper currency we’ve had for so many years, and very well could be the future of all monetary exchanges. Crypto’s future may be uncertain, but one thing is; only time will tell if it fulfills the huge potential people see in it, or it fizzles out and becomes a fad of its time.