WHAT IS CRYPTOCURRENCY?
You probably are in a different world, if you not heard about bitcoin (cryptocurrency).
A lot of people have heard of it but don’t really have an idea what it is and how it
works. Bitcoin is just a type of cryptocurrency and there are others, like Ethereum,
litecoin etc. I will explain each of the types in the next articles I will post.
But what exactly is cryptocurrency, it is a digital money designed to work as a medium,
to secure transactions, to control the creation of additional units, and to verify the
transfer of money. It uses cryptography to undertake such exchanges. Cryptography which
evolved around World War II was used to transfer data and information in a very secured
way but now it is used to secure communications, information and money online.
So cryptocurrencies allows users to make secure payments, without having to go through
As I said earlier in the above paragraph there are many types of cryptocurrency,
which include Bitcoin, Ethereum, Litecoin, Zcash, Dash, Ripple, Monero and many more.
Bitcoin is mostly used because it is the first cryptocurrency and it was introduced
in 2009 since then over 900 other cryptocurrencies has been introduced. I will explain
into details each of the types of cryptocurrency mentioned above and any other one which start to rise.
HOW IT WORKS
block_chainCryptocurrency operates on a blockchain, the validity of each cryptocurrency’s coins
is provided by a blockchain. A blockchain is a continuously growing list of records,
called blocks, which are linked and secured using cryptography. By design blockchains are inherently resistant to modification of the data. It records every transactions between two parties’ efficiently and in a verifiable and permanent way. The blockchains is run by miners who use powerful computers that tally all the transactions. What exactly the miners do is to ensure an update is made each time a transaction is made and also ensure authenticity of information.
Even though there is no fixed value for it, cryptocurrency like any other thing changes
based on demand and supply. It is mostly based on the value of cryptocurrency trading
elsewhere and also the agreement between buyers and sellers. Each transaction is made
public to all the people in the blockchain network. Transaction can be made very easy
with the use of cryptocurrency with no intermediary unlike the banks. Cryptocurrency
can easily be acquired online through exchanges with traditional currencies. Example