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When it comes to understanding cryptocurrency and blockchain, almost the entire world is in the dark. Bitcoin is stored on the first blockchain and was first released in 2009. Although over the past decade Bitcoin and blockchain have become more mainstream, the crypto and blockchain worlds are still in their infancy. stammering. The real estate world has been forced to adapt faster than most, as demand for using cryptocurrency for real estate transactions has gone to the moon and blockchain developers have created databases. digital technologies that streamline and secure all aspects of the real estate industry.
Miami quickly became the Cryptocity and became a cryptocurrency and blockchain hub led by Mayor Francis Suarez. Mayor Suarez’s goals include turning Miami into a Bitcoin mining hub using the city’s nuclear capacity. It is also working to allow the use of Bitcoin to pay taxes and utilities, as well as a salary option for city employees. Mayor Suarez focused on a tech boom in Miami after the COVID-19 pandemic and worked to attract top tech and investment firms from San Francisco, Silicon Valley and New York. The effort has paid off, as evidenced by taxable property values in Miami which have doubled over the past decade as well-paying jobs have been drawn to the weather, beaches, restaurants, nightlife, low taxes and quality of life.
As Miami and Crypto quickly became synonymous, in honor of Miami Crypto Week and following a PROFILEmiami Instagram Stories poll in which 41% of our followers said they had invested in cryptocurrency, we wanted to make sure that no member of the PROFILEmiami community was in the dark when it came to blockchain, cryptocurrency and real estate. In this three-part PROFILE Insider series, we’ll explore the differences between blockchain and cryptocurrency, how the two apply to the real estate industry, and how Miami is striving to become the center of what could be the age of d gold of cryptos.
Part 1: Blockchain versus Cryptocurrency
Understanding the difference between blockchain and cryptocurrency is essential. A blockchain is a publicly distributed digital ledger that is managed by a peer-to-peer network using cryptography. It is made up of an ever-growing list of records that track the history and dates of transactions, ownership or occurrences of any or all processes stored on this blockchain.
Each record is known as a block and can store data on anything from Bitcoin to a real estate deed to a property and its history to farm-to-table food tracking. Each block is time-stamped and once stored, it cannot be modified without modifying all the resulting blocks.
The blockchain was invented by Satoshi Nakamoto in 2008 and this specific blockchain became the public transaction ledger for the world’s first cryptocurrency, Bitcoin. To this day, Satoshi Nakamoto is not identified and it is not known whether the name represents a person or a group.
A cryptocurrency is a medium of exchange for digital assets that are denominated in coins, which represent the ownership of that digital currency. A coin is a verifiable record stored on a decentralized crypto blockchain. Cryptocurrencies appeal to many due to their decentralization from governments and central banking systems. Different cryptocurrencies include Bitcoin, Ethereum, Dogecoin, Ripple (XRP), Tether, Aave, Internet Computer, Bitcoin Cash, Litecoin, Polygon, among thousands of others called altcoins.
In a transaction, the transfer of value between each party is validated and stored on a new block, leaving behind a signature called a private key or seed. The validation process, known as mining, occurs when a transaction is broadcast over the cryptocurrency network and the transaction is confirmed by powerful computers solving extremely complex mathematical codes that maintain the validity of the transaction. ledger of transactions. As computers solve the codes, successful miners will produce cryptocurrency as a reward. Cryptocurrencies can be traded directly from wallet to wallet, but can also be traded in the same way as stocks or exchanged for Fiat currencies such as the US dollar or other cryptocurrencies on exchanges such as Coinbase, FTX and Kraken.
Cryptocurrencies are stored in digital wallets. There are two types, a hot wallet and a cold wallet. Hot wallets are run on internet connected devices such as phones or computers. They are very easy to use and deal with as it is usually an app on your phone but for this reason they also lack security and can be easy to hack or physically force access if stolen . The best hot wallets include the Coinbase wallet, Electrum, and Exodus.
Cold wallets, also known as hard wallets, are completely offline devices that are not connected to the internet, therefore much more secure. Many look like a USB stick or smartphone, which store users’ private keys on secure hardware. A 24 word recovery code is the only backup of private keys once transferred to the hardware wallet. One of the most popular is the Ledger Nano S and Ledger Nano X wallets which use a proprietary operating system designed to provide the highest level of security to protect your crypto assets.
Among the top three popular cryptocurrencies, Bitcoin is considered an asset of similar quality to gold and has the potential to become the world’s leading currency; Ethereum is a complex blockchain that is evolving to become the world’s leading computing platform; and Dogecoin, a multi-billion dollar crypto enthusiast and favorite coin of Tesla and SpaceX CEO Elon Musks. Dogecoin is a memecoin, which means that it started out as a joke, but is now considered by some to be a legitimate investment asset.
As of June 6, 2021, Bitcoin had a market cap of $ 676.13 billion, Ethereum of $ 314.56 billion, and Dogecoin of $ 48.14 billion. Bitcoin hit $ 64,829 per coin in April 2021 before falling to the middle of $ 30,000 in May 2021. Etherem peaked at $ 4,380 in early May 2021 before falling back to the middle of $ 2,000 . Cryptocurrency markets continue to flourish among institutional investors and retail traders and something like a simple tweet from Elon Musk can send the crypto markets into a frenzy.
Stay tuned for Part 2 of our three-part PROFILE Insider series where we will explore both the application of cryptocurrency and blockchains to real estate.
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