What Is Cryptocurrency
Simple Explanation Of Cryptocurrency
Imagine there are two friends Frank and Daniel. One day they decided to go on a trip to Venice. They made a budget list for all their expenses like residents' flights, etc. They thought of making their bookings online from a site that offered discounts to the first 10 visitors on that day, while making their respective flight bookings, Daniel's transaction failed, and he missed the offer going on. On the other hand, Frank paid his share very quickly. And easily, it became one of the three lucky draw winners.
Frank used Bitcoin a type of cryptocurrency. cryptocurrency is a virtual or digital currency that works on blockchain technology and is designed to work as a medium of exchange online to buy goods and services and make payments, which was introduced to the world first 2013 by Satoshi Nakamoto.
Daniel felt that it sounds similar to other online payment options. Yes, what makes it so different?
Frank, explain. cryptocurrency is decentralized and free from any third-party interference, which means it is not issued and controlled by any government or central authority, unlike other payment systems that banks or governments are handling. And that's why a cryptocurrency transaction never fails.
There could be many reasons why Daniels's transaction failed, like he may have exceeded his transfer limit, or his account must have been hacked. Or there could have been some technical issue with his bank service or maybe due to high transaction fees imposed by the bank.
Convenience
But on the other hand, cryptocurrency charges almost no or very low transaction costs. There is no limit to making transactions. You have 24/7 access to your money. There is no extra delay for extra charges on making international transactions. And the best part is that anybody can use cryptocurrency without the hassles of paperwork. All you need to do is create an account on any digital wallet of cryptocurrency.
This is what makes cryptocurrency different from other online payment options. Daniel was impressed by cryptocurrency, but he wondered how it works without the control of an external authority.
cryptocurrency works on blockchain technology. Blockchain is a set of blocks that record information of transactions like who made the transaction to whom the amount of trade in the form of a digital ledger that is distributed across the entire network, meaning the data is replicated and stored on each node across the entire blockchain network, making it more secure and impossible to change or cheat the system.
Then it is verified and validated by every node to proceed with the process of making the transactions.
What Does The Word Cryptocurrency Mean?
Crypto and cryptocurrency stand for cryptography, which is a method of using encryption and decryption to secure the data in the presence of any third party with ulterior motives.
Now Daniel was completely aware of the whole technology and concept behind cryptocurrency and was influenced by Frank to adopt cryptocurrency in his daily lifestyle, too.
He did that by booking his ticket, but sadly, no discount. Like Daniel cryptocurrency has influenced and impacted an enormous number of people worldwide.
Future Of Finance
Due to this increasing popularity, new companies like me and PayPal are coming forward and investing in cryptocurrency every day. In 2018. Malta, an island located in the Mediterranean Sea, south of Italy, was titled a blockchain Island as it led to the economic stability of a nation. Many FinTech companies like finance and oke X have already begun to take advantage of halters' financial incentives that move their headquarters to the blockchain island.
Cryptocurrency like bitcoin use an algorithm called SHA 256, there are various algorithms that cryptocurrencies use these days.
cryptocurrency is revolutionizing finance and banking around the world. Thanks to cryptocurrency Now, anyone with an Internet connection can trade spend and borrow money around the world and nobody can stop them.
What Do People Think Of Them?
People like Bill Gates, co-founder of Microsoft Corporation, and Elon Musk CEO of Tesla support cryptocurrency as it is much better and more secure than physical money and also holds a great future for the world's economy.
And on the other hand, some people think of cryptocurrency as a bane to the world's economy, like Warren Buffett, CEO of Berkshire Hathaway, and Ajay Banga, CEO of global MasterCard, who feel the cryptocurrency is a platform for criminal activities and will destroy the world's economy will one thing is clear that this conflict is going to stay put for a little longer.