Can somebody explain Bitcoin and Litecoin and perhaps some of the others in easy to understand terms?

Question

I just bought some Litecoin today because my friend who's made at least ten times his money in the last year or two reckons that's nice and cheap at the moment, relative to how much it's probably going to be worth, considering it's an offshoot of Bitcoin or something.

He tried to explain it to me, block chains and cryptos and all that, I can't say I get it, but I do understand one thing, it's made people rich over the last ten years, and if I had got in early, I would have been rich, so I got three hundred worth of Bitcoin today, at fifteen thousand a coin, and five hundred worth of LItecoin at about a hundred a coin, and I'm just sort of wondering about the short and long term prospects, not that anyone can really say, but also why people want them, and how likely it will be that they put in vastly more sums of money, because the graph over the last four years for Bitcoin looks like a huge curve up. through the roof, and I bought when it was high already.

Answer 1

All bubbles burst, it's only a matter of time... trick is, don't be greedy, get out before it does, or at least take out your principle investment, so you are not in the hole. Markets are always highest before they crash.

At the moment, you can ride the wave of abundant money laundering by shell corporations.. .

Answer 2

The words "...or something" is the glaring red warning light that tells me you are going to lose all your money. You don't understand what you bought but because other people have made money at it you're buying it. You are the Greater Fool in the Greater Fool Theory. You are why Beanie Babies were going for over a thousand dollars and why tulip bulbs were going for more than annual earnings of most Dutch way back when.

Answer 3

Ponzi schemes

Answer 4

you need to do more internet research on these forms of currency

Answer 5

I'm a programmer i can explain



Bitcoin and Litecoin and other crpto currencies like ether are all essentially just encrypted data from an encrypted database that is what the block chain really is . The bitcoin block chain really is just a public ledger that stores all transactions ever made with bitcoin . it is similar to the way banks and credit cards keep track of transactions through ledgers for digital money fiat currency . The thing with the block chain is that its a public ledger that everyone has access to so everyone knows who own what bitcoin and every transaction made by everyone who owns bitcoin so you never have cases of fraud. Since only a fixed set of 21 million bitcoins will ever be released . Every fragment of these bitcoins are just encrypted data. When you own a bitcoin what you are owning is an encryption key to that part of the data base that is the bitcoin block chain which is completely encrypted.



When people mine bitcoin what they are doing is using their computers to solve algorithm to decrypt the encrypted data of this database that is the bitcoin block chain and release it . then they store the bitcoin which is the encryption keys in a bitcoin wallet

which is a medium that holds the encyrption keys which can be anything like a flash drive , hard drive paper etc

in lay mans terms an ecryption key is just a sequence of computer code which is like a password is the best way i can dumb it down



People who mine bitcoin what they are doing is using their computers to decrypt code in that database and releasing that data which is the bitcoin itself at the same time processing bitcoin transactions.



Litecoin is essentially the same thing as bitcoin except coding script in its programming is a bit different allowing for transactions to be faster than bitcoin



because of all this encryption and because of their scarcity this allows them to be protected from inflation and fraud and allows them to be a decentralized digital currency allowing some annonyminity for their users as intended by their creators bitcoin whose creator is anonymous we don't know who made bitcoin



So it's value is in its scarcity set to 21 million ever to be released the block chain encryption technology and its intended use which is to be a currency as a medium of exchange and store of value.





as for an investment i'm no financial advisor or analyst but if you look at it's graph from the last year and last 5 years its showing all the same characteristic features of a classic Bubble asset like the dot com bubble and will eventually burst and crash who knows when



its price is being driven based purely on speculation and FMO (fear of missing out buyers)

its the most volatile asset you can have and right now its acting pretty poorly as a currency because no one is spending it or using it

they are just buying and holding hoping the price goes up and to cash out

it doesn't fulfill any of the key characteristics of currency which is to be a store of value and medium of transfer

its price is so volatile and it keeps going up and down that no one would use it as a medium of transfer for goods and services let alone a store of value



so its hard to say what will happen in the long term but trust me that bubble is gonna pop and bitcoin will crash and it has done so several times in the past and recovered . But as of now Bitcoin has a fatal flaw in its programming code i would say that unless is changed its going to have lots of problems processing a high volume of transactions which will be really slow and will drive transactions fees through the roof which will make people lose interest in it and abandon it if not fixed. In fact the transaction fees to transfer bitcoin right now are pretty high its like 10 USD or more for a purchase of like less than 5 dollars with bitcoin which is nuts lol

Answer 6

So you bought $4.5 million worth of bitcoins?From buying 300 bitcoins at $15 thousand a coin?Then you bought $50,000 worth of litecoin.from buying 500 litecoin at $100 a coin?If so,mate you already rich!! How much more money do you need if you can invest that amount?some people just very fortunate.