Cover Story: Cryptocurrency 101...time to invest?

Image caption

Ohio Treasurer Robert Sprague is looking to change state law so that the state could allow for people to use bitcoin to pay state fees and services. So far, 15 states are investing in this blockchain technology.
But what does that even mean? What is a blockchain and what is cryptocurrency for that matter?

"The market has been going crazy with cryptocurrencies recently, and people have really been starting to gain a lot of interest," said Ryan Housteau, a financial advisor with Capital Group of America in Boardman.

Slowly but steadily, crypto is becoming an essential way of transferring funds and payment for services in the US.

"What crypto now allows people to do online all over the world using the internet is to send value directly from one person to another in a way that's fast, simple and very, very cheap. So using these cryptocurrencies, people can do much more than just buy things on the internet. They can now begin to invest obtain credit," said Paul Grewal, of Coinbase.com.

"So basically, what crypto is is it's a digital asset that's used for investing, for payment, and it can be used to represent some kind of physical asset in the digital world, like gold or a us treasury," said Housteau.

The most widely known and used cryptocurrency is bitcoin.

"Some examples that you've probably heard of would be Bitcoin, Ethereum, XRP, Solana. Bitcoin, as an example would be one that's used more for investment, since it's more of a store of value," added Housteau.

Introduced in 2010, at the time it had the value of around 40 cents. Since that time, its value has gone up and down.
By 2013 one bitcoin was worth around $750. In 2017 $14,000. But the next year it went down to $3700.
By 2021 it was worth $46,000 then the following year, just $16,000.
Today, though, one bitcoin is worth around $111,000.

Local financial planners like the Capital Group of America in Boardman are now telling their clients a diverse portfolio maybe should include something like bitcoin, just do your homework first.
That's why states are starting to invest.

"So now you're going to be seeing cryptocurrency being integrated with our current financial system more," said Housteau.

"I think the most important thing for regular folks to do to protect themselves is to educate themselves first and foremost. If something sounds too good to be true, it probably is. If someone's promising, promising you significant and great returns with little or no risk, be skeptical," said Grewal.

It's ok to be skeptical of something that's not tangible, something you can't touch. But in a way, bitcoin isn't much different than your paycheck. Numbers are sent to your bank from your employer, not actual cash, right?

So what does the future hold?

"I think people are going to grow much more confident and comfortable with this. And the easiest way to understand that is go talk to anybody under the age of 40. This is very natural to them," added Grewal.

Technology is always changing the way we do things and crypto maybe just another part of that.