Digital Coins vs. Physical Coins (Part 1)
With the introduction of new technology and its rapid growth, it comes as no surprise that we’re starting to see innovative new products at the forefront. In recent years, there has been a surge in the concept of digital coins and the cryptocurrency realm.
What exactly are they, and how are they made? What sets them apart from physical coins? Read on to find out all about them.
What are Digital Coins?
Digital coins come under the category of digital currencies. These are intangible coins that are only available in electronic form rather than physical form. The transfer of digital currencies and cash is also only done electronically as a result.
Digital coins—such as Bitcoin, Ethereum, Cardano—aren’t backed by any central regulatory authority or the government; the value for digital currencies works on demand and supply.
How Are They Made?
Unlike physical coins—like gold coins—that undergo an arduous manufacturing process, digital currencies are made through a complex process called mining. This is a small fraction of the whole blockchain technology concept.
A mining setup is quite challenging to make, as it requires powerful computers to solve complex algorithms that result in a block being created. Then, this block is what makes a digital coin like Bitcoin, which is stored in digital ledgers.
Apart from the vast financial and computational resources needed to set up crypto mining, the process is also known to be harmful to the environment.
How are Digital Coins Different from Physical Coins?
Physical coins are tangible items that are valuable due to the precious metals that are used to make them.Several physical coins are known to be true collectors’ items, like the American Eagle Coin and the American Buffalo Coin.
Investing in gold coins is a great way to make profits when you decide to sell them. There are also various other benefits of investing in precious metals, as a hedge against inflation and a haven in times of economic recessions.
The attractiveness and lure of physical coins will never go out of style. Orion Metal Exchange offers highly reliable services when it comes to precious metals, so you can be assured that the whole process of buying gold or silver coins will be secure. Get in touch with us to get started.