In the recent few years, Cryptocurrency, Bitcoins, Blockchain has created much hype among the techno-maniacs. However,all these terms are associated with a single destination thought, that is virtual money. Cryptocurrency or the money of the future is a very interesting currency which not only helps us with our monetary needs but also secures every transaction by its Blockchain algorithm.
So in this article, we will clear all the doubts and answer the commonly asked questions of Cryptocurrency and technologies related to it.
Also to know more about Blockchain algorithm, click here.
What is Cryptocurrency?
Cryptocurrency is a digital asset which works for transactions and exchange between users. It uses cryptography for any exchange of resources making the entire system extremely concrete in terms of security. This kind of virtual currencies use decentralized control as opposed to centralized digital currency and central banking systems.
The decentralized control of each cryptocurrency works through distributed ledger technology, typically a blockchain, that serves as a public financial transaction database. It is also famous for its organic nature, as there is no central controller hence rendering it theoretically immune to government interference or manipulation.
How are Bitcoins related to Cryptocurrency?
Well, Bitcoins is Cryptocurrency only. It is the first virtual currency based on cryptography. Bitcoin is the most famous of this kind. Transactions are verified by network nodes through cryptography and recorded in a public distributed ledger called a blockchain. Bitcoin was invented by an unknown person or group of people using the name Satoshi Nakamoto. Because of its high-end security, this kind of cryptocurrencies has become the hot pick for all the investors and business tycoons.
What happens at the back-end of Cryptocurrency?
On an overview, Cryptocurrency is based on one major principle, that is the Blockchain algorithm. The blockchain is the backbone of the new internet. In simple terms, Blockchain is a time-stamped series of immutable record of data. Self- authorized computers then control the data. Now each of these computers has its own set of information about the transaction called “tokens”. Several cryptography algorithms are present to secure these tokens. In addition to this,the blockchain network has no central authority — it is the very definition of a democratized system. Since it is shared and immutable ledger, the information in it is open for anyone and everyone to see. Hence, making the entire system transparent to all.
In order to understand the technology, let’s understand it according to the data miners perspectives. Cryptocurrency works on Blockchain technology which works on peer to peer algorithm. Each computer acts as a peer having a total history of the transactions. Hacking into the system is very difficult as in order to get into the system, one needs to crack each and every tokens, which is a difficult task to do.
Why should one opt for Cryptocurrency?
There are actually several reasons why one should try Cryptocurrency out of which some are listed below:
Immediate Settlement: Bitcoins does not involves any third party authourity. Bitcoin contracts can be designed and enforced to eliminate or add third party approvals, reference external facts, or be completed at a future date or time for a fraction of the expense and time required to complete traditional asset transfers.
Decentralization: It means there is not a single almighty authority controlling the functioning. As the control is divided among the participant components, the entire system is made highly transparent to all.
A decrease in the level of fraud: Frauding is not an option. As a result of high-end security algorithms ,working behind it protects the money from frauds or hackings.
Access to everyone and anywhere: Almost anyone can access the cryptocurrencies. In addition to, this type of virtual money doesn’t charge any interest, exchange rates, so it can be used universally.
We are in a high-tech world. Being technically aware is like a boon. Similarly, Cryptocurrency is such another boon. It’s like there is no need to carry your wallet everywhere or worry about theft. Also,bitcoins are not the only currencies which we have. Hence, several other currencies are present with their own perks and benefits. Many technologies are invented keeping in mind this 21st-century unicorn. Like there are android apps on which one can put their bitcoins directly on the share market.
The need of the hour is to adapt with the new. So dont hesitate to invest on cryptocurrency and be a part of the future money.
To know more about Cryptocurrency, click here.