This collection of notes ‘Future of cryptocurrencies’ is written with an idea to change what people think about cryptocurrencies and the technology behind it, as well as motivate them to learn this topic more thoroughly. People learning this subject are pursuing different goals, and thus can be categorized into different groups:

Investors: are learning cryptocurrencies and its technologies with a goal to increase their capital;
Developers: are applying their technological skills and abilities in order to develop projects that depend on cryptocurrencies. Cryptocurrencies are also helping them to gain additional revenue as well as implement their ideological life principles into perpetual code;
Students, housewives and other people in search of an additional revenue: learning about cryptocurrencies can help those people earn an additional $300-$500 on average by taking part in such events as Airdrops, Bounty programs and other events related to cryptocurrencies;
Scientists: are studying about cryptocurrencies, which aids in the expansion of area of professional interests. Cryptocurrencies can be especially interesting to mathematicians, economists, sociologists, engineers. Cryptography, game theory, programming, game-design, mechanical design — if you are interested in any of those topics, cryptocurrencies are a great start for future development;
Futurists, writers: it is highly likely that cryptocurrencies are going to become ubiquitous in the near future. Learning about cryptocurrencies can be useful to those who wish to predict ways of how that could play out on humanity.

Reading this material should take about 15–30 minutes and ideally strongly encourage you to learn about cryptocurrencies and topics related to them. Mainly, this paper is aimed at people who are not well familiarized with the topic of cryptocurrencies and still think that they are some kind of toy for programmers to play with. Cryptocurrencies have long surpassed the state of a programming experiment and are now closely tied to different social aspects. There are tens if not hundreds of millions of dollars as well as substantial human resources that are being involved in the industry. Of course, in the context of the whole world, these numbers are tiny. Thus, there is a large potential for future growth. This paper is structured in an answer-to-question format. In the future, those answers will be populated with more information.

What cryptocurrencies exist in the world today and how do I get information about them?

As of june 2019, there are more than 2000 cryptocurrencies in the world. The main cryptocurrency — bitcoin with capitalization of 140 billion dollars. This is the cost of all the obtained bitcoins on the market. The total value of cryptocurrency market is estimated to be 260 billion dollars. A fairly big capitalization and a large variety of cryptocurrencies make this system really stable. If five years ago you could argue the development of cryptocurrencies, now this area is evolved and can grow exponentially. Traditionally, information about cryptocurrencies can be obtained from an analytical portal https://coinmarketcap.com. In the future, we’ll take a look at other tools

2. What makes bitcoin so special compared to other cryptocurrencies? How many bitcoins are there?

Bitcoin — is the first cryptocurrency, that has become so widespread and dominating on the market and. BTC — is a cryptocurrency, that has overcome the experimental stage and earned a practical application among millions of users. BTC is also closely related to real technical power of machines because of so called mining. Mining is a process in the protocol of Bitcoin, that adds a block of data in the data registry with transactions which causes an emission of bitcoins. As a result of such emissions, there will be a total of 21 million bitcoins that are produced in its whole lifespan. This, cryptocurrency is a limited resource, that statement is guaranteed on the code-level of that cryptocurrency. As of 2019, 17 million bitcoins have been released, which is the majority of the stated emission.Various statistical data can be viewed on:https://www.blockchain.com/charts For example, the amount of bitcoin wallets is an interesting data field to observe:https://www.blockchain.com/charts/my-wallet-n-users

3. What makes Bitcoin so unique in comparison with regular electronic monet and non-cash money transfers?

The most important thing to notice about BTC is that you don’t need a centralized financial entity in order to perform transactions. You can transfer your bitcoins to any part of the planet, any time. Your transaction can not be blocked or track, unlike with regular centralized transactions. That means that nobody will never be able to confiscate your bitcoins. If you store your bitcoin access keys correctly, you will not be able to lose them, nobody will steal them, nor could the administrative authorities confiscate them. Of course, you might have heard in the news about the confiscation or loss of bitcoins, but all of them are one way or another lead to an improper storage of access keys. Your bitcoins can not be faked, nor can you spend them twice, that is impossible on their code-level. In the cryptocurrency jargon this property is known as “inability of double spend”.

If you wanted to make an analogy in the real world with bitcoins, then you could imagine something along those lines: your bitcoins are stored in an armored safe, that could withstand a nuclear war. In the terms of cryptocurrencies, that armored safe is your public address. The key to that safe is unique and can not be faked, because the amount of different keys that could be made is greater than the amount of atoms in the universe. The key in and of itself is a collection of symbols or a phrase that you could even memorize. In the terms of cryptocurrencies such a key is called a public key, and the phrase is called a seed phrase. Only the owner of a private key or a seed phrase can determine if somebody else could access the safe with bitcoins. You should never give your keys to other people, unless you want to lose all your bitcoins. Of course administrative authorities or bandits could insist on you giving them the key, but the end decision is still on your side. Without your permission, nobody can access the safe.

If we were to compare bitcoins to regular money, the following analogy would be suitable. Information about the state of your bank account is stored in the centralized database. When you make a transaction, an administrative authority looks at your actions and decides whether you’re a good or a bad person and using his key transfers the money from one entity to another. If the bank or your payment system suddenly decides that your transaction is suspicious then there will be no money transfer. You don’t have the key, therefore you will not be able to make the transaction yourself by any means. In bitcoin you have full access to that key, which means that you and only you decide when to make the transaction. You don’t need the banks permission. You’re truly free!

If in some country starts to think negatively about cryptocurrencies, the investor simply moves to another country. He has the unique key to the safe with cryptocurrencies, and he can use it anywhere he wishes. No need to carry out a bag of cash, no need to open an offshore account in Switzerland, no need to be tied to England’s real estate, no need to worry about the integrity of your business in some other country. You just need to remember the unique collection of symbols or words, that give you access to your cryptocurrency.

If you want to delve deeper into the technological side of Bitcoin’s protocol, I recommend the following resources: https://courses.blockgeeks.com/?ref=413

4. Are retail investors the only people investing into cryptocurrencies?

Investments into cryptocurrencies are usually followed by some obstacles, because only some countries sell cryptocurrencies officially. Despite that, investors in more developed countries are investing into cryptocurrencies. Let’s take a look at some examples so that you can understand how big this market is.Pension Fund of the USA is investing into cryptocurrencies and the technology behind it by the means of a distributed registry: https://www.bloomberg.com/news/articles/2019-02-12/first-u-s-pension-funds-take-the-plunge-on-crypto-investing

Canada allows investing in accredited investors in BTC: https://www.businesswire.com/news/home/20180910005151/en/Canada%E2%80%99s-Regulated-Bitcoin-Fund-Eligible-Accredited-Investor

South Korea Pension Fund invests millions of dollars in cryptocurrency infrastructure: https://www.financemagnates.com/cryptocurrency/news/south-korean-national-pension-fund-invests-cryptocurrency-exchanges/

Another interesting fact: endowment funds from leading universities of the world invest in cryptocurrencies. It also adds seriousness to the fact that the world’s Internet infrastructure, which billions of people use, has been developed in these universities in the last century. Now we will analyze specific cases. For example, the Yale University Foundation.The assets of Yale University are estimated at almost $ 30 billion. The foundation is run by the ‘Yales Warren Buffett’ — David Swenson, who has been doing this for 33 years. Is the foundation successful? Let’s look at the profitability of the fund compared to peers:

The average annual yield of the best endowment funds for 20 years

Photo source: https://static1.squarespace.com/static/55db7b87e4b0dca22fba2438/t/5ac5890e758d4611a98edd15/1522895146491/Yale_Endowment_17.pdf

As we can see, this is a top fund. The rates of return exceed those of other universities and significantly exceed the return on passive investments. The fund invested in two cryptocurrency funds: a16z crypto, launched by the venture capital firm Andreessen Horowitz, and Paradigm Fund managed by Coinbase co-founder Fred Ashrsam, former partner of Sequoia Capital Matt Juan and ex-Pantera Capital employee Charles Noyes.

And this example is not unique, at least five more funds invested in cryptocurrency. These include Garvada and Stanford Universities, Massachusetts Institute of Technology (MIT), Dartmouth College and the University of North Carolina: https://www.ccn.com/breaking-harvard-stanford-mit-have-all-invested-in-cryptocurrency-funds/

You can still find dozens and even hundreds of examples, I’ll just just give one more. This time from the venture capital industry. There is a rather unique participant on the market with a whole set of successful projects — Sequoia Capital. The fund was founded in 1972 and during this time among their investments: Cisco, Google, Yahoo, PayPal, Youtube, LinkedIn, Dropbox, Stripe, Square, Airbnb, WhatsApp, Instagram and dozens of others. Do you know these giants, in which Sequoia invested at an early stage, when nobody knew about them yet? Today, the fund invests in cryptocurrency projects, including Orchid Protocol, Starkware, Ontology, Handshake, IOST and others. Something tells me that in such an experienced team, people know where to invest for the future growth of their assets.

Endowment university funds, pension funds and venture funds differ in that they think of long horizons of investment. They do not care about short-term quick profits, the sprouts of their investments sprout in 10–15–20 years. Their investments in cryptocurrencies mean that they believe in their ubiquitous distribution in the future. We can notice the decisions of the giants and try to repeat them, or we can further doubt the cryptocurrency. What choice will you make?

5. What do famous people think about cryptocurrencies?

Many famous and rich people invest in cryptocurrencies. This means only one thing: they will become even richer. Of course, among celebrities there are opponents of cryptocurrency, but I clearly observe the trend: people are increasingly beginning to change their minds in a positive direction regarding cryptocurrencies.

Let’s look at the quotes.

Bill Gates, the founder of Microsoft:

« Well, Bitcoin is exciting because it shows how cheap it can be. Bitcoin is better than currency in that you don’t have to be physically in the same place and of course for large transactions currency can get pretty inconvenient».

Eric Schmidt, Computer Science Ph.D., former head of Google. He is currently the Chairman of the Board of Directors of the Alphabet. Schmidt is ranked 138 in the list of the richest people in the world with a net worth of 8.3 billion dollars.

«Bitcoin is a remarkable cryptographic achievement. The ability to create something which is not duplicable in the digital world has enormous value.»

Richard Branson, British businessman and investor, founder of the Virgin Group Corporation, which includes more than 400 companies. Branson ranks seventh in the UK’s richest people list. His net worth is estimated at 4.9 billion dollars.

«Virgin Galactic is a bold entrepreneurial technology. It’s driving a revolution. And bitcoin is doing just the same when it comes to inventing a new currency.»

Peter Thiel, co-founder of PayPal, investor in Bitcoin payments service Bitpay.

«PayPal had these goals of creating a new currency. We failed at that, and we just created a new payment system. I think Bitcoin has succeeded on the level of a new currency, but the payment system is somewhat lacking. It’s very hard to use, and that’s the big challenge on the Bitcoin side».

Ilon Musk, co-owner of SpaceX, Tesla CEO.

«It cryptocurrency bypasses currency controls. … Paper money is going away. And crypto is a far better way to transfer values than a piece of paper, that’s for sure».

Al Gore, US Vice President and Nobel Peace Prize Laureate.

«When bitcoin currency is converted from currency into cash, that interface has to remain under some regulatory safeguards. I think the fact that within the bitcoin universe an algorithm replaces the function of the goverment …[that] is actually pretty cool».

John McAfee, founder of the McAfee antivirus software development company.

«It is not a speculative investment even though it is being used as such by other people. As Bitcoin network grows the value of Bitcoin grows. As people move into Bitcoin for payments and receipts they stop using US Dollars, Euros and Chinese Yuan which in the long-term devalues these currencies».

We took a look at the quotes of famous people who became well-known because of “their brains”. The best minds of the planet for the most part see positive moments in cryptocurrencies and invest in them themselves.

6. Where are cryptocurrencies used? What are the perspectives?

In this note we will discuss practical cases of cryptocurrency.

Cryptocurrencies are an excellent means of payment, including cross-border. Commissions in various payment systems of the ‘regular money world’ can reach up to 5–10%. Why pay such a commission when cryptocurrencies can be sent with almost zero commission?
Cryptocurrencies are very convenient in the gaming and gambling industry. In the future, whole virtual worlds will be built, which will have its own currency that has value in the real world. Of course, it will be based on cryptotechnologies.
Cryptocurrencies are used in smart contracts and allow you to delegate contractual relations to software and automatic levels.
Cryptocurrencies can be used for the “communication of things.” For example, a car can pay for the toll road in an automatic mode, “talking” with road sensors. There are still millions of cases from IoT (Internet of Things), where cryptocurrency will be used. If you take the domestic sphere, the heaters in the house can automatically pay utility bills to the heat supplier, bypassing the management company. As a result, it will be faster, cheaper and more convenient.
Cryptocurrencies are an investment tool and are weakly tied to the real world economy. This property helps investors diversify their investments if they add more cryptocurrencies to the ones they already have.
Cryptocurrencies will become a means of transferring value in social networks and instant messengers. Currently, we can send a message through any messenger in a fraction of a second, and sending virtual values will soon be added to our messenger toolchain.
Any business can use cryptocurrency. For example, we can create a digital art shop and accept payment for our creativity in cryptocurrency anytime of the day from anywhere in the world. Or we can create gift cards, that accept funds in cryptocurrency. At any time, the owner of funds can exchange them for another cryptocurrency, or use them as a discount or a bonus.
Cryptocurrencies can be used in the government. Based on cryptotechnologies, a voting procedure can be created or we could organize a registry of land owner.
Cryptocurrencies will be used in the calculation of the basic income of citizens determined by their online work. Currently it already works in various airdrop and bounty programmes, people receive $50-$3000 monthly in cryptocurrency for their actions in the network. Gradually, this model will be adopted by the countries as well, since such an initiative will work better than benefits and subsidies from a moral and social point of view.
Transactions in the digital world are transparent if the cryptocurrency is not completely anonymous. Due to the property of openness, budget, charity and investment funds will be spent completely transparently. Any participant can trace the chain of expenditure of funds. As a result, people will behave more honestly, and corruption could be minimized.
Cryptocurrencies can be used to tokenize real-world assets. In this case, some part of the property is matched by a digital entity. For example, we divide an expensive picture into 100 parts, assigning a token to each part and sell 100 tokens on the open market. As a result, each owner of the token owns a piece of an expensive painting. He can resell it, receive his percentage of the dividends, if the picture goes to a paid exhibition. Art, real estate, transport, business, roads, places of public use and other real objects can be tokenized.

In this section, I also would like to dispel the myth that cryptocurrencies are widely used in the criminal world:

Usage of BTC on darknet

Less than 1% of BTC transactions are accounted for the darknet market. In fact, for criminal purposes, cash is most often used. In some countries, up to 20% of all cash transactions account for criminal purposes. Cash is difficult to track, the transfer takes place without intermediaries and virtually anywhere.Here are just some examples of the use of cryptocurrency. In the future, the amount of different things you could do with cryptocurrencies in the real and the virtual world will become even larger.

7. Cryptocurrencies are competing with fiat money, is that actually good?

Before discussing the benefits of cryptocurrency competition, let’s try to give an actual definition of money. What is money and what is it for?

Money is a kind of unit that measures human labor that benefits other people. In classical economic thought, the more a person works for the good of society, the more money he gets. And this is not necessarily about the individual labor of a person. He can manage people, increasing the working capacity of the team as a whole. For this, the team gives the manager a piece of their work. A person can also create technology that will increase the productivity of the current economic process. If you want a lot of money, then in fact there are two main and honest options: to very effective to yourself or create a team / technology that improves the efficiency of other people’s work. In the end, you must benefit people, and through the money mechanism they will indirectly thank you.

If there were no money, we would have to make an instant exchange. No one could produce goods or services for the future. I grew potatoes, and I need a haircut. With no money at all for each haircut, I would have to pay potatoes. This is inconvenient, so people invented various pebbles, shells and animal skins.

With the formation of statehood, we have a centralized body that issues money. Money serves as a single medium of exchange. We will not delve into the history of money. We will dive into the modern world of money. The problem is that modern money is in fact not provided with anything. If you think that they are provided with gold or oil, then you are mistaken. Try to show all the dollars to the bank, and there will not be enough gold for everyone. The same thing happens with any other modern currency. Is there a problem with this? Of course. Again we will try to consider this problem on a life analogy.

And first, let’s analyze the concept of monopoly. Monopoly is a situation without choice. For example, if you like trains and want to move from point A to point B by train, then you will have to travel using the services of a natural monopoly on the railways. Any monopoly, even a natural one, leads to the fact that the monopolist becomes a bold, arrogant and criminal market participant. This is always experienced when receiving services from monopolists. Perhaps in human nature there is a hidden need somewhere in the subconsciousness for the humiliation of the weak by the strong. But just remember any situation where the subject of the relationship is a monopolist. Did you get a passport? How were you approached there? Did you contact the district clinic, because it was not possible to go to the paid one? Is there a friendly attitude? What is the attitude of a rural notary to his clients? I think that each of us at least once in his life faced a situation of monopoly. And everyone understands that monopoly is destructive in the interaction of individuals.

Now let’s combine money and monopoly. And we will have the most terrible thing of the modern world. Monopoly on the issue of money. Do you think that it is different from the woman in the passport office? Or is it is friendlier than the clinic manager? In fact, it is even worse because it is faceless. The owners of the money do not see the torment and grief of their victims, so they act even harder. Of course, state institutions are restraining the onslaught of money monsters, but their power is still major and unlimited. The bad thing is that they use cunning methods that are difficult for an average person to understand. But let’s analyze at least one example. For example, the monetary authority decided to save a large bank and printed a lot of money. Yes, yes, just pressed a button and instead of the conditional 30 trillion rubles, it now has 36 trillion rubles. But with such an issue, no more goods or services appeared in the economy, which means that other goods or services simply rise in price by about 20%. And what does this mean for someone who has transferred part of his labor into money and invested them in financial instruments? This means that, thanks to the emission scam, a handful of beneficiaries from the bank just robbed all hard working citizens. Of course, a citizen, as lay a million on the account, and lies. But only if earlier he could buy 1000 grocery sets for this million, now he will buy about 830. This is the way a bunch of insolent people have devalued the work of an honest citizen.

It just happened to be that in history the society does not tolerate monopoly. We on an instinctive level feel that each of us must have more or less equal conditions for survival in this world. Any monopoly sooner or later collapses. Once the monopoly of the Roman Empire fell. Once fascist Germany collapsed. Any villain, any abstract monopoly is squeezed out by people who value freedom. And now comes the time of the destruction of the monetary monopoly. This monopoly will be very difficult to destroy, since it is tied to the punitive functions of the state and to the general dependence of society on money. You can’t just stop the circulation of money. But smart people are creative. And now a cryptocurrency has just been invented, which can fight with classical or fiat money.

A cryptocurrency is valuable because it contains 2 functions at once: it is used as a kind of data container, inside a cryptocurrency project + it can be used as a preservation of the results of labor, that is, in fact, to act as money. And this double strength of cryptocurrency makes it an excellent weapon for the destruction of monetary monopoly. It creates competition. Now each of us, if he wants, can already choose: in what way do I keep my investments? You can choose the ruble, and you can choose the air or bitcoin. A freedom of choice now appears. A new economic era is born, where there will no longer be mass economic robberies. But we are only at the very beginning of the journey. Soon the monetary authorities will understand the danger of their position. And then we will see the war of the cryptocurrencies and fiat money. The winner here is already clear. Monopoly is always crumbling. But the fight will be the largest in the history of world battles. We will not win immediately. Perhaps the victory will move away by 30–50–100 years.

However, we are grateful to the cryptocurrency, that it already grants the opportunity of choice to smart people.

8. Do well-known companies use blockchain technology? What do corporations think about cryptocurrencies?

Large technology companies have long been exploring options for using blockchain technologies in their business processes, and many have already implemented them. Research is also being conducted in this area, corporations are filing patent applications for the blockchain know-how.

For example, there is an open source project — Hyperledger. The project is a large work to create an open distributed system that can be used for open development and implementation of the blockchain in business processes. The focus is on creating and launching platforms that support global business transactions. The project was created by the Linux Foundation and is supported by real giants: IBM, CISCO, Intel, SAP, Bosch, Deloitte, FedEx, Huawei, Lenovo, Oracle and other giants. All members of Hyperledger can be found at: https://www.hyperledger.org/members Under the auspices of Hyperledger, several solutions are being developed. The most well-known currently is the open-source solution for private blockchains — Hyperledger Fabric under the auspices of IBM and Digital Assets.

Google added the Ethereum blockchain to the data analysis service: https://cloud.google.com/blog/products/data-analytics/ethereum-bigquery-public-dataset-smart-contract-analytics

Google also integrated the Chainlink oracles protocol into its services: https://cloud.google.com/blog/products/data-analytics/building-hybrid-blockchain-cloud-applications-with-ethereum-and-google-cloud

As we can see, the search giant is no longer just exploring cryptocurrency , and delivers ready-made services for interacting with public blockchains to end users.IBM in the blockchain environment is also known for an abundance of patents, ranging from augmented reality interaction patents and blockchain technology to the use of the blockchain in the logistics and supply chain. IBM has a whole section on the blockchain site: https://www.ibm.com/blockchain

Let’s look at some more bundles of well-known companies and cryptocurrency technologies:

Nothing unusual, Forbes is developing an analytical portal on cryptocurrency: https://www.forbescrypto.com/
Yahoo competes with Forbes in cryptocurrency analytics: https://finance.yahoo.com/cryptocurrencies/
The US Securities Commission made a whole section on cryptocurrency and ICO on its website: https://www.sec.gov/ICO
IBM creates a directory of digital technologies and blockchain companies: https://unbounded.network/
You can give hundreds of examples of the application and study of cryptocurrency giants. I hope that you no longer have any doubts that the cryptocurrency trend is developing with mad power and the world-famous giants are at the forefront of the great movement.
9. How are social networks and cryptocurrency connected? Of special interest are Facebook, WhatsApp, Telegram, Viber and others.
In a separate note I want to highlight the giants who develop cryptocurrency, which will be used by hundreds of millions of users.Facebook plans to launch Libra cryptocurrency in its services. Uber, Visa, Mastercard, PayPal and more than 25 companies have already invested in the company’s initiative for at least $ 10 million. Cryptocurrency can be used in Facebook services, online stores and WhatsApp messenger. Total Facebook plans to attract about one billion dollars for its development. Cryptocurrency launch is expected in 2020. Watch for Libra here:https://libra.org/ and https://calibra.com/
Back in 2018, Telegram Messenger officially raised $ 1.7 billion to create the blockchain platform TON and the internal cryptocurrency GRAM. Wikipedia has a whole section on the new cryptocurrency and its platform: https://en.wikipedia.org/wiki/Telegram_(software)#Telegram_Open_Network_ICO It is expected that the Token Gram will be launched in the third quarter of 2019.
Viber does not take such obvious steps as its previous competitors. Nevertheless, a number of actions by the company Rakuten, the owner of the Viber messenger, indirectly indicate the possible implementation of cryptocurrency in the Viber messenger. Rakuten actively buys cryptocurrency projects: exchanges, wallets, payment services.
Let’s consider the more “exotic” ones. Line is a fairly popular messenger in the world, especially in the Asian region. The information resource Craft.co tells us that over 200 million people use a messenger monthly, and the number of installations on all platforms already exceeds one billion. It should also be mentioned that Line is not just an instant messenger, but already an entire ecosystem of games, various applications and related industries, such as the sticker market. The corporation will launch Link’s cryptocurrency on its own blockchain and is going to do all this in a legal legal field. So, in Japan, for the first time, “LINK Point” will be used until the legal component in this region is settled. Already, Line is planning to open a crypto-exchange:https://www.bloomberg.com/news/articles/2019-06-20/line-said-to-near-approval-of-japan-license-for-crypto-exchangez

Korean Kakao Messenger also develops its own Klaytn cryptocurrency, as well as introduces a multi-currency cryptographic chain. The company actively cooperates with other cryptocurrency projects, for example, Theta.Teams from all over the world are trying to create a second Instagram / Facebook / TikTok, where cryptocurrency will be actively used. Steemit, Golos, Dlive, Bermi, Blive and many others are already participating in the race.In the future, cryptocurrency will be as easy to send as we are now sending messages to each other. And we will do it every day, as well as every day we use instant messengers and social networks.
The only thing you need to learn is what cryptocurrency Facebook, Telegram and other social networks will release. If the network management has the right to take the currency from the user for one reason or another, it will be a quasi-cryptocurrency. Remember that the real cryptocurrency belongs only to the user and no centralized authority has the technical ability to select it without the consent of the user.
I will quote Stepan Gershuni:“Thanks to Libra from Facebook and TON from Telegram, 1.5 billion and 300 million users will learn about cryptocurrency respectively. The one part and the other is more than bitcoin users in the entire history. Gradually, they will have a reasonable question — is there any such cryptocurrency, only so that Facebook could not ban my account and take all my money? ”
10. What are smart contracts and Ricardian contracts?
Smart contracts allow you to create complex conditions for the movement of cryptocurrency. For example, a smart token ABC is created with a quantity of 1000 tokens. The investor can send 1 air on this contract and automatically receive 10 ABC tokens. Such a condition is written in a smart contract. This is the simplest example of using a smart contract. In reality, there may be smart contracts with more complex conditions. Thanks to the oracles in smart contracts it is possible to deliver external data. For example, farmers can create a seasonal insurance fund tied to the average air temperature. At the end of the season, the funds of the insurance fund will be automatically redistributed according to the conditions created in the smart contract. No approval from the insurer or auditor is required. Honesty is guaranteed by a smart contract code. Many digital relationships can be translated into smart contract logic. The most popular platforms for smart contracts are now Ethereum, Tron, IOST.
Ricardian contracts can be called the following modification of smart contracts. In fact, this is a smart contract that is legally binding and is “understood” not only by a computer, but also by a person. You can say this is an electronic document in the usual human form, but the key parameters of which are recorded in the blockchain. Execution of the Ricardian contract is guaranteed by a computer code, and in the case of disputes may entail real legal consequences. Ricardian contracts in the future can reduce the work of notaries to a minimum, improve the operation of online stores, optimize logistics processes, transform the financial sector and reduce transaction costs in other sectors of the economy. The main contenders for the Ricardian contracts include projects EOS, Tezos.
11. Is it reasonable to keep cryptocurrencies in the investment portfolio?
From a professional point of view, it is not reasonable not to keep cryptocurrencies in a portfolio. Many financial participants in the world have already appreciated the advantages of owning a cryptocurrency, and someone is only going to invest in them, since there has not been a legal opportunity before.

If you have already dealt with investments, you have heard the phrase: you should not keep all your eggs in one basket. When we invest only in the assets of the fiat money world (stocks, bonds, real estate and others), we automatically keep our funds in the “classic basket”. At the same time, a “cryptocurrency basket” has been developing in parallel for more than 10 years. The presence of cryptocurrency in your investment portfolio not only increases its potential profitability, but also generally reduces its risk. Assets are reallocated between systems.

Speaking in a more professional language, cryptocurrencies have a weak correlation with assets from classical finance. This means that the movements of stocks, bonds, and gold weakly repeat the movements of cryptocurrency. Stocks rise, cryptocurrency may fall. Stocks fall, cryptocurrencies can grow. A weak correlation allows for a more balanced portfolio. Let us translate the words into numbers and look at the correlation table of Bitcoin and cryptocurrency indexes with real-world assets (highlighted in orange):

If you are from the world of finance and are familiar with portfolio theory, then you understand the beauty of having cryptocurrencies in your investment portfolio. For the rest, let us explain: a weak, and often even a negative correlation, is an excellent signal for including an asset in an investment portfolio. Of course, if this asset has a positive expectation in future periods. After reading a series of notes, I think that you will have a “positive” expectation for the future of cryptocurrencies.

The correlation has an interesting feature: it does not save investment portfolios when it is most needed. I think that many people remember the crisis of 2008. That year, bonds, stocks, real estate prices and other assets fell. There are suggestions that this does not affect cryptocurrency. On the contrary, they grow due to crises, as people run into cryptocurrencies from inflation of national currencies. Cryptocurrencies can be a real life saver for your investment portfolio if a local or global crisis occurs.
Keep a part of your funds in cryptocurrency, do not put all the eggs in one basket.
12. How will deprication of local currency affect my cryptocurrency portfolio?
Cryptocurrencies are global digital currencies. Relatively speaking, they are tied to global space. Of course, the largest peg goes to the dollar, as there are many trades and calculations in relation to it. If a regional currency begins to depreciate, then it depreciates and relative to cryptocurrency, all other things being equal.
If there is a certain amount of cryptocurrency in your portfolio with an estimate cost of $1,000 or 65,000 rubles while the exchange rate is 65 rubles for a dollar, then if the dollar rate rises to 80 rubles, your crypto-savings will be estimated at 80,000 rubles. Thus, the cryptocurrency is a kind of insurance against ruble depreciation. If in the future you expect a dollar in the region of 80–100 rubles, then this is another plus in favor of having cryptocurrency in your investment portfolio.
13. How do regulators in the world treat cryptocurrency? Do they really consider cryptocurrencies as something important?
Securities commissions, central banks, governments and other regulatory and administrative units are closely following the development of cryptocurrencies and are exploring the possibilities of using them.
Perhaps one of the most significant events in this area took place in April 2017, when Japan recognized cryptocurrency as a means of payment. After that, many countries began their way in the regulation of cryptocurrency. The situation here is changing now every day. Many legal organizations, working groups with various government agencies are studying the regulation of cryptocurrency in the world. For example, evaluate the 429-page report on the regulation of cryptocurrency:
https://www.dropbox.com/s/s1w0ymiw12soqy2/The-Virtual-Currency-Regulation-Review---Edition-1.pdf?dl=0
Here are some things in terms of regulation that convince us of the serious penetration of cryptocurrencies into society:

In Ohio you can pay taxes with cryptocurrencies:https://qz.com/1474124/the-people-of-ohio-can-now-pay-taxes-in-bitcoin/
On the website of US Securities Commissions there is a whole section related to cryptocurrencies and ICO.
Malta at the state level wants to gain a foothold as a reliable jurisdiction for blockchain companies.
Switzerland is already called by some people Crypto Valley, people there open blockchain companies and even have legal crypto funds.
FATF develops circulars on the rules of regulation of cryptocurrency among the participating countries.
Cryptocurrencies are discussed at the World Forum, in the US Congress, in the European Parliament, at G20 meetings.
Australia has developed legislation in the field of ICO and cryptocurrency.

The world is changing every day in front of our eyes. As we can see, developed countries seek to lead progress and develop regulations for its regulation. Who is trying to ban cryptocurrency? Iran, India and other developing countries. Perhaps they do not know about the impending wave of the digital world?
14. Can cryptocurrencies be traded on stock exchanges? What graphics do they work on? What is DEX?
Cryptocurrencies can be exchanged for each other through centralized cryptocurrency exchanges and through decentralized exchanges or protocols. In the first case, you trust your cryptocurrency to the exchange organizer. In the second case, the exchange occurs at the protocol level, you do not need to trust a third party.
Centralized cryptocurrency exchange
These stock exchanges are comfortable with their liquidity: the exchange takes place very quickly. You can quickly get BTC to the site and exchange it for the desired cryptocurrency. In the process of opening an account, as a rule, you need to go through the procedure of identification of the individual — KYC (know your client). The disadvantage of such exchanges is that in this case you do not own de facto your cryptocurrency. The exchange may close, it may get hacked, the management of the exchange may be put in jail. In this case, you lose your cryptocurrency, since you do not have a private key. The most reliable exchanges for June 2019 include Coinbase, Binance, Huobi.
Decentralized exchanges and protocols
Decentralized exchanges operate in such a way that you do not lose access to your cryptocurrency even in the exchange process. There are significant drawbacks: low liquidity, slow transaction speed, incompatibility of various blockchains (currently you cannot change this way, for example, EOS for Tron). The exchange usually occurs within a single blockchain: for example, the etheric token is changed to the etheric token. Right now advanced technologies of decentralized exchange (atomic swaps, cross chains) and the idea of DEX-exchanges are being actively developed. Most likely, in the future all the disadvantages of the current DEX will be eliminated.
Also, the benefits of both types of cryptocurrency exchanges include the fact that they work all the time. Classic stock exchanges work on schedule, at night, investors sleep. Cryptocurrency is a world without borders, that is why non-stop exchanges work here.
Interestingly, cryptocurrencies or derivatives on them (futures, options, etc.) are already being traded on classical exchanges or are about to be traded.
Bitcoin futures are on the Chicago Mercantile Exchange: https://www.cmegroup.com/education/bitcoin/cme-bitcoin-futures-frequently-asked-questions.html
Bitcoin Trust offers Grayscale: https://grayscale.co/bitcoin-trust/
In Switzerland, you can buy cryptocurrency ETP products:https://www.amun.com/en/index/
The Nasdaq Stockholm trade Exchange Traded Notes on BTC:http://www.nasdaqomxnordic.com/etp/etn/etn-historical?Instrument=SSE109538
As of June 2019, the largest stock exchanges of the world, the NYSE, the Nasdaq, the London Stock Exchange, the Swiss Exchange, the Australian Security Exchange and other exchange giants are considering entering cryptocurrency trades in the world.
15. Long-term trends in cryptocurrencies. What is the growth potential of a cryptocurrency market?
Cryptocurrencies are quite a young phenomenon. Nevertheless, it is already possible to trace some indicators of the industry.The number of Bitcoin wallets https://www.blockchain.com/charts/my-wallet-n-users?timespan=all:

Growth in wallet amount

Average number of confirmed transactions per dayhttps://www.blockchain.com/charts/n-transactions?timespan=all:

Average number of transactions

Cryptocurrency capitalization

Cryptocurrencies, like any markets, have their own crisis situations. That is what we see on the last chart. The 2018th year was hard for cryptocurrency. Most of them lost in value, while market capitalization fell by 79%. It should be understood that the classical markets at different historical stages also had crises. Let’s look at the maximum fall in stock markets of different countries:

Drawdowns in stock markets

No developed country managed to escape the crisis. We should not be frightened by the fall of 2018. This is a normal situation for any market that is going through a phase of rapid growth.Also in this part we will try to assess the growth potential of the cryptocurrency market. To do this, look at the capitalization of assets in the world:
Gold: 8–9 trillion dollars;
All banknotes of the world: about 8 trillion dollars;
All shares of the world: about 80 trillion dollars;
World real estate: about 230 trillion dollars;
Derivatives Market: about 550 Trillion Dollars
The capitalization of all cryptocurrencies on June 24, 2019 is 328 billion dollars. They are used by about 1–2% of the world’s population. Moreover, about 47–48% of the population uses the Internet. The growth potential of cryptocurrency to one gold: you need to grow almost 30 times. Growth potential to Internet users: you need to grow 25–35 times.
We just gave some figures about the entire market and its competitors. I think that they are enough to understand the potential of the scale of the new cryptocurrency industry. Growth of 25–30 times from current levels can be called the end of the era of the formation of a new market. The market will become quite mature, mad returns will become a thing of the past. Manage to make cryptocurrency capital here and now.
16. Is it possible that in the best universities of the world there are courses on cryptocurrency and blockchain technology?
According to the 2018 data, 21 of the 50 best universities in the world presented courses on blockchain technology and cryptocurrency.
Source:https://blog.coinbase.com/the-rise-of-crypto-in-higher-education-81b648c2466f I doubt that the best minds of the world would be taught something that has no future. List of universities with the number of relevant courses:

Courses on blockchain and cryptocurrency in the best universitiesThe online portal Coursera issues 38 courses for “blockchain” requst:https://www.coursera.org/courses?query=blockchain& and 20 courses on request “cryptocurrency”: https://www.coursera.org/courses?query=cryptocurrency&T
he future generation is preparing for a new reality. Each of us can also attend online courses. You can start with free online lectures.A lot of materials puts out the platform Blockgeeks. Courses for investors, developers, students and researchers. They are constantly adding new current articles, videos and programs.

Other points are here: https://medium.com/@cryptoved/future-of-cryptocurrencies-or-cryptocurrency-guide-for-people-6980f84a25f

Cryptocurrency future is coming. The choice is yours.
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