“Bitcoin is a digital gold – it is harder, stronger, faster and smarter than any money that has preceded it.” ― Olawale Daniel
Every an innovation comes out with a new technology that could make human life a little easier from a few seconds back if we look in past 5-6 year than these technology has made its space in different sector of the society and believe it or not but the society is indeed getting benefit out of it whether it be the sector of medicine, education or one of the most important sectors of finance and banking.
Cryptocurrency is a word that can be familiar to a lot of us and if is known then let’s discuss that how this technology or a can simply say invention is spreading itself in finance and banking sector widely over time and now is been used worldwide in terms of payment. even there so much saying that the cryptocurrency is the new trend. Cryptocurrency can be defined as a digital currency that is been made secured by the process of cryptography. This process enables the security in such a way that the particular currency once used can not be used again this term is known as double-spend. The invention of cryptocurrency is done under the blockchain technology. Blockchain is distributed ledger which is enforced by several networks of computers. Cryptocurrency is a decentralized currency it is not used by any govt central authority but is produced by the network distributed over millions of people.
It is a new form of digital currency. It allows secure payments online handled virtually through the tokens which are represented by ledger entries internal to the system. The term crypto refers to a set of algorithms used behind this invention. There are techniques which are responsible to safeguard these entries, such as elliptical curve encryption, public-private key pairs, and hashing functions. The first cryptocurrency base on blockchain was Bitcoin which in the years has gained a lot of popularity. In today’s date, there are so many alternatives of Bitcoin as there were discoveries of many cryptocurrencies as time passed. A large among them is a fork of bitcoins while few are new cryptocurrency.
Bitcoin was launched in the year 2009 by an individual or a group known as Satoshi Nakamoto. The name Satoshi Nakamoto is a term associated with bitcoin was whether it’s an individual or a group of people remain a mystery as there was almost no one who claimed it to be their discovery. At Nov. 2019, there were over 18 million bitcoins in circulating which has a market value of $146 billion. There is a huge competition between cryptocurrencies in terms of which one is most popular among the users and the most widely used still bitcoin has successful been in that top position that is giving tough competition to cryptocurrencies such as altcoins,” include Litecoin, Peercoin, and Namecoin, as well as Ethereum, Cardano, and EOS.if today we see the aggregate value of cryptocurrencies by combining all then it would be about$214 billion among which bitcoin has 68% contribution.
There is a talk among people that says that cryptocurrencies are developed using military applications. There was a lot of tries to even lock this technology but is successfully running due to for civilians to use cryptography was secured on grounds of freedom of speech.
In this technology the central has very little contribution also this ledger can only be done in online mode thus there is no second option present. Thus, all the transaction made is online. This technology is no single person driven but runs a ledger that involves a network of people and as it’s a based on blockchain thus is been provided with a data structure that is quite secure and is shared and agreed upon by the entire network of individual node, or computer maintaining a copy of the ledger.
A new block is generated every time a transaction is made and is verified by every node that was created before that and after that only it is been approved making it almost impossible to forge transaction histories. According to experts blockchain technology can be used in various serious works like finance and banking, voting, crowdfunding and enhancing the techniques of payment presently in use .but as theses currencies cant be stored in a central database and made in work only virtually thus many think it would blend the digital payment techniques and the sector as well as the customer will face a great loss that would not be able to deprived back. Also, at the same time as there isn’t any central authority and govt or corporation that could help in refunding that many in case of ant loss faced.
Cryptocurrencies have given an assurance to make a direct transaction between two parties much easier than the present system without being relied on the third party to give direction to do so. The security of theses transaction is here based on public keys and private keys and some proof of incentive system like proof of work also known as proof of stake. The private key is assigned to the user wallet used to make a transaction while the public key is for the owner and used to sign the transaction. The fund transaction is completed with a little amount of charge that allows the user not to give all his money in hands of third party for the wire transaction.
The cryptocurrency transaction opens various doors for even illegal activities to take place like tax evasion while even the authority gives assurance of high security and privacy. Some cryptocurrencies are more private than others. As if we consider bitcoin than conducting illegal business using it would surely be the worst idea ever made and the person would be greatly in lost after trying to do so. The system is designed in such a manner that within some sort of time the forensic of bitcoin finds the culprit and arrested at the same time.
It is true that the market price of cryptocurrencies is based on supply and demand thus the rates for exchange often fluctuate but the high degree of scarcity is given by most of this cryptocurrency. This is even true that bitcoin has experienced various ups and downs and leads to degrading in its value at that time. Many observers see potential advantages in cryptocurrencies.
The virtual currency is indeed new to us but it offers some sides of security that other currencies aren’t able to provide so the need is to understand the potential it possesses and the parts it could be used in as this could serve the best to the people using it which are you and me.