Get the Better newsletter. Despite the recent downturn and fluctuations in the market, the top 100 cryptocurrencies boast a current market cap of , and the majority of Americans — 69 percent — expect the price of cryptocurrencies to rise in the next five years, according to a survey by the Global Blockchain Business Council. In the case of bitcoin and other digital currencies, however, there is no standardized physical representation like a dollar bill — the assets exist only in digital form. There's also no regulation. HOW DOES BITCOIN WORK? The technology that makes bitcoin and other digital currencies work is called , which Mercina Tillemann, chief operating officer at the Global Blockchain Business Council, says is kind of like a set of railroad tracks. When you send bitcoin to someone, the transaction is verified by computers all over the world. The computer or data center that verifies the transaction first it involves solving a complex mathematical equation is rewarded in the form of a bitcoin payment, says Kyle Forkey, general partner at Amentum, a cryptocurrency investment firm. People and groups who race to do this can turn a significant profit. Until recently, it was difficult to move something digitally without the risk of it being copied or altered in the process. For example, think about when you send someone an email — you retain the original, and they receive a copy. But because there are no restrictions on who can participate and no account minimums , they're not the traditional financial services players. SHOULD YOU INVEST IN BITCOIN? Before diving into bitcoin or other digital currencies, you need to understand the risks. It's normal in the world of cryptocurrencies for prices to go up and down 30 percent in a single day, says Bobby Ong, co-founder of , a cryptocurrency valuation and ranking website. If you decide to go forward, dollar-cost averaging could be a good way to do it, since each prices vary widely from day to day. Take the amount of money you decided to put in, then divide it by 12. On the first of every month for a year, buy that amount of your chosen currency. Diversity in this sector is as important as it is in the markets overall. Several other cryptocurrencies have made it into the American consciousness over the last few years, including Litecoin, Ripple, and Dodgecoin. HOW DO YOU INVEST IN CRYPTOCURRENCIES? Finally, let's talk about security risk here — and the extra steps you need to take to keep your assets safe. When you buy stocks, a registry is kept of all the shareholders. The site gives you a unique key a string of letters and numbers to use for access. But keeping your bitcoin in the exchange-provided digital wallet might not be the most secure option — for example, in January of this year, when they broke into an exchange called Coincheck. Suffice it to say you'll have to keep this device as safe as possible. Ironically, the best place to do that might be an old-fashioned safety deposit box at an old-fashioned institution called a bank. NBC News BETTER is obsessed with finding easier, healthier and smarter ways to live.
