A currency that is trending all over the world

Cryptocurrency which has created a buzz in the 21st century, So what is cryptocurrency actually is? Why was it invented? 

In this Article, you find answers of the following :

1. What is Cryptocurrency?
2. How Cryptocurrency came into existence?
3. A brief note on Blockchain Technology?

What is Cryptocurrency?

In simple terms, Cryptocurrency is a digital currency or digital money which is used to buy goods and services. 

It is basically based on cryptography, so it got its name as Crypto + Currency.

It's not like a regular currency such as the Dollar or Rupee, which we are using on a daily basis to buy goods and services. It has a digital existence.

A Cryptocurrency uses digital files as money. These files are created using the same methods as Cryptography. In simple terms, Cryptography means the science of hiding information. Digital signatures can be used to keep the transactions secure, and let other people check that the transactions are real. It is a currency, made independent of government-issued currencies.

How Cryptocurrency came into existence?

The idea of electronic peer-to-peer currency came into existence a decade ago, but it became successful in 2009, when bitcoin was conceived. The first decentralized Cryptocurrency, Bitcoin, was created in 2009 by presumably pseudonymous (a fictitious name) developer Satoshi Nakamoto. Since the release of bitcoin (Now Famous Cryptocurrency) , many cryptocurrency have been created. 

Cryptocurrency was invented to fix a number of perceived flaws with the way money is transmitted from one party to another.

Flaws, What kind of flaws? 

For example, Our banking system takes longer to settle cross-border transactions,  or how financial institutions take rewards as fees by acting as a middleman or third party for transactions. Cryptocurrency works on traditional financial systems through the use of Blockchain Technology.

What is Blockchain? 

Basically, Blockchain is a digital ledger, where all cryptocurrency transactions are stored. Suppose you buy bitcoin, sell bitcoin, or use bitcoin to buy a McDonald burger and so on, it’ll be recorded, in an encrypted format, in this ledger. This same goes on for other cryptocurrencies.

Think of blockchain as infrastructure that underlies virtual coins. It’s like a foundation of your home and what is built on foundation are virtual coins.

Blockchain is way better than the current system of transferring money. Why?

This blockchain technology tackles two main issues:

Firstly, Normal Currency has Centralized control, which means that they are controlled by one person or government. There is no transparency in the system for currencies issued by central banks.  Cryptocurrency is decentralized. No one person or authority has control over it and it protects against cyberattacks, such that criminals are not able to gain control over cryptocurrency and exploit crypto holders. 

Secondly, as there are no middlemen in Blockchain technology. The transaction fees will be lower than what charged now.

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