Cryptocurrency For Beginners
Imagine you're having conversation with your friends now at same point in this conversation someone's going to bring up crypto currencies now crypto currencies is something that everyone wants to talk about no one really knows how they work so today I'm going to fix that . Crypto currency explained since man, world currency has been a very important part of our lives in caveman era they use the barter system now the barter system involves goods and services being exchange among each other so now we have a situation where two person is exchanging five apples and getting oranges in return now barter system fell out of use because it had some glaring flaws now these flaws include having peoples requirement coincide for example say you have five apples and your friend has five oranges now until and unless your friend has a requirement of apple you can't get oranges .
You will not be ready to make an exchange for it there's is no common measures of value . The goods cannot be transported easily now unlike our modern currency fits in our wallet our mobile phone the goods that you own that cannot be taken with you everywhere . In 110 BC an official currency was minted in thousand 250 AD ,gold plated Florence was introduced and this was used across Europe & from 1680 to 1980 paper currency gained widespread popularity and was used across the world .Modern currency included paper currency and coins credit card and digital wallets for eg; Apple pay, Amazon pay , pay pal and so on all of this was controlled by banks & government now this means that there was centralized regularity .
More than 1600 cryptocurrencies available now there are some popular ones like Bitcoin, it's Harry amends each cash and new crypto currency crops up every single day now considering how much growth they're having at the moment there's good chance there's plenty more to come in the upcoming years .
What exactly is Cryptocurrency ?
Cryptocurrency is a digital or virtual currency that is meant to be a medium of exchange . Now crypto currency is quite similar to real-world currency just that it does not have any physical embodiment it also use cryptography to work the way it does now some of the features of cryptocurrencies are that there's a limit to how many units exist in bitcoins will be produced you can easily verify the transfer of funds now the hashing the algorithms that Bitcoins use make it very easy for users to determined where the transaction is valid or not they operate independent of bank or a central authority they work in decentralized manner now new units can be added only after certain conditions are met for example Bitcoin only after block has been added to the blockchain will the miner be rewarded with the bitcoins and this is the only way new Bitcoin can be generated .
Firstly there little to no transaction costs if you use the digital wallet you will know that ,if you are transferring money from your wallet to your bank account you loose some amount of money . You have 24/7 access to money you can't walk up to your bank at 3 am morning and say that you want to withdraw some money there is no limit on purchases & freedom for anyone to use . If you are setting up an account in your bank you need to do some amount of paper work and documentation with cryptocurrencies all of that can be avoided International transactions are faster the wire transfers take about a half a day to transfer money from one place to another but the cryptocurrencies it only take a matter of minute or seconds .
What's the ''crypto"' in cryptocurrencies ?
Cryptography is a method of using encryption and decryption to secure communication in the presence of third parties with ill intent . Cryptography usually requires a computational algorithm like (SHA256 ) , a Public key (that the user shares with everyone ) and a Private key ( which acts a digital signature of the user ) . Lets talk about a normal bitcoin transaction first you have the transaction details now this details who you want to send them then it passed through a hashing algorithm for bitcoin we use the SHA 256 algorithm the output that you obtain is passed through a signature algorithm with the users private key now this is uniquely identify the user this output is then distributed across the network for people to verify this is done by using the senders public key the people who verify the transaction to check whether it's valid or not . I am sure it's sure to say that the encryption is extremely difficult to hack .
Bitcoin vs Ether
Ether; Ether is currency that accepted in the Ethereum Network . Ethereum Networks on the blockchain technology to create an open source platform to build and develop decentralized applications . It is used as currency in the Ethereum network . Transactions are manual or automatic . It take about a 20 seconds to finish a transaction . Ether is used to power the Ethereum Network and Power real life transaction . Ether is expected to be continuous but not expected to exceed 100,000,000 . As of July 14 2021 one Ether equal 1,935 US DOLLARS .
Bitcoin; Bitcoin is a form of digital currency and is decentralized without a central bank , it uses a blockchain
to perform transactions on a peer to peer network . It is used to send money to someone . Bitcoin transactions are manual . It takes 10 minute to perform a transactions . It is used like money , for real world transactions . There's a limit to how many bitcoins can exist : 21,000,000 . As of July 14 2021 one Bitcoin equal 32,476 US DOLLARS .
What's the Future of CRYPTOCURRENCY ?
On One side you have supporters like Bill Gates , AI Gore and Richard Branson who says cryptocurrencies are better than regular currencies on the other hand we have people completely against . If people like Warren Buffet , Paul Krugman and Richard Schiller who are both Nobel Prize winners in the field of Economics they call it a Ponzi scheme . In the future there is conflict between regulation and anonymity . Futurists believe by 2030 , cryptocurrencies would occupy 25 % of National Currencies . Increased acceptance by Merchants and Customers . It will continue to have a Volatile which means prices will continue to fluctuate like they have been for the last few Years .
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