You must have heard of cryptocurrency at least once. Recently, many people are talking about cryptocurrency and buying cryptocurrency as an investment. However, most people do not know what exactly cryptocurrency is, and some people just invest in cryptocurrency without any knowledge about it. Because of cryptocurrency, many people lost their money and house. So, what is a cryptocurrency, and why it becomes a global problem?

▲ Picture of Bitcoin

Cryptocurrency is money that is being encoded by using blockchain technology. It was developed in 2003 and was commercialized in 2011. Cryptocurrency is based on blockchain technology. Blockchain is one of the security technologies. So, people can mine cryptocurrency by using their computers. Computer, which is used in mining cryptocurrency, changes the code which is called a hash value, so anybody cannot steal money and anybody cannot find out where the money is used. Also, it is much safer than a bank because it cannot also be hacked, and if all of the countries using the same cryptocurrency, it will be much safer to use money in another country. However, why other people say cryptocurrency is a problem?

In South Korea, many people lost their workplaces, and other people could not earn more money because of the influence of COVID-19. Also, many people did not go out. So, they started to put an investment in stock to earn money or just for fun. However, because COVID-19 is prolonged the economic market is worsening, economists anticipated that the value of the currency will fall down. At that time, many people were looking for a safe currency, and cryptocurrency received attention as an alternate currency. Many economists and rich people like Elon Must invested in cryptocurrency. People, especially in South Korea, invested a lot of money in cryptocurrencies such as in Bitcoin and Ethereum because they wanted big money.

▲ Other cryptocurrencies.

However, they just invested money without knowing proper information about cryptocurrency. Also, many people lost their money a lot. unlike the stock market, the cryptocurrency market is not regulated by the government, and it does not have a proper law, so it can fluctuate abruptly. People who lost money because of cryptocurrency continued investing in it to replace the money that they lost. Strangely, they could not earn money and keep losing their money although the price of coins keeps increasing. Soon, many people were addicted to cryptocurrency, and cryptocurrency just became a form of gambling.

Cryptocurrency is useful and efficient if we use it properly. People can buy things much easier and can protect their money much safer. However, a lot of people just invest in cryptocurrency without knowing any information, and this situation makes cryptocurrency a form of gamble. We can use cryptocurrency much useful if we make more regulations about cryptocurrency and invest in cryptocurrency with correct information.

By Minseok Kang