Bitcoin and ethereum are the best-known cryptocurrencies on the market. However, there is another virtual currency that grew explosively in recent weeks and you probably have never heard his name: the IOTA.
The striking growth of bitcoin in recent weeks has not been enough to quell the doubts generated by a market that offers huge returns but is not subject to regulatory controls. However, the increase in its value has been overshadowed by the explosive rise of a much less known cryptocurrency.
This is the IOTA, an investment product that declares itself "the backbone" of the "internet of things" economy. The value of the IOTA increased unimpressed 774% from the beginning of November to date.
This has raised the total market capitalization of IOTA to $ 12,000 million dollars, allowing it to enter the list of the five largest virtual currencies in the world (bitcoin, ethereum, bitcoin cash, IOTA, ripple), according to the financial information site MarketWatch.
This happened after the publication of reports that several high-profile technology companies (including Microsoft) were coordinating efforts with the German NGO that monitors the IOTA to create a secure data market so that they are not wasted.
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IOTA co-founder and CEO David Sonstebo told the financial news network CNBC that "currently 99% of this valuable information is lost in a vacuum."
"IOTA encourages the idea of sharing the data through their transactions free of the payment of a fee and ensuring the integrity of the information for free," he added. According to the specialized site Cryptocurrencychart.com, on December 6 the IOTA came to be worth $ 4.5 dollars per unit, while the bitcoin was $ 12,962 dollars.
The controversy over growth
Unlike conventional currencies, cryptocurrencies are digital representations of a security that are not issued by a central bank or a credit institution. They are virtual currencies.
The most popular one is surely bitcoin, a file that is stored in a "digital wallet" of a computer. The main ways to acquire cryptocurrencies are: buy them with "real" money; sell products or services that are paid with them and acquire them through new companies that make their own virtual currencies.
It is a market that has no regulation by governments or credit institutions, but is completely in the hands of private investors. And it is booming: the value of bitcoin, also known as "digital gold", grew more than 1,200% in the last year.
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Many analysts believe that it could be the biggest financial bubble in history, among them Nobel Prize winner Joseph Stiglitz, who recently expressed his concern in his interview with the BBC.
"Why do people want bitcoins? Why do people want an alternative currency? The real reason why people want an alternative currency is to participate in vile activities: money laundering, tax evasion," Stiglitz said.
Beyond the warnings that economists, governments and central banks have made, for the time being investors are still betting on the growth of the cryptocurrency market, although the uncertainty about whether the whole system will explode (and when) continues to hover in the air .
Apparently the old principle of "more risk, more gain" in this market is seen in all its expression.
Written by: @silvayoneifer