What is a Cryptocurrency?-A guide to building an understanding in Cryptocurrency
In our previous blog, we discussed the origin of cryptocurrencies and the technology that underlies it. We also introduced some key terms which will be used throughout this series of blogs. In this article, we’ll be discussing all about cryptocurrency. We’ll try to cover all the different cryptocurrencies available in the market and how you can use them.
What is a Cryptocurrency?
A cryptocurrency refers to a digital asset that acts as a medium of exchange using strong cryptography. The transaction of such currency is secured and monitored by a distributed ledger system known as blockchain. Due to its design, blockchains are inherently resistant to fraud and modification (i.e., they are immutable). Moreover, as it doesn’t exist physically, cryptocurrencies are not controlled by any central authority or government but are based on pure mathematics.
Cryptocurrencies have gained quick popularity since their inception due to their design and high degree of security they provide along with their decentralized nature which doesn’t require a third party to ensure smooth transactions between parties.
How do Cryptocurrencies work?
Cryptocurrencies use a special kind of technology called cryptography that ensures that each individual unit is
What is a Cryptocurrency?
To fully understand what a cryptocurrency is, we must first understand the basics of currency. Currency is anything that serves as an agreed upon medium of exchange for goods and services. In other words, currency is something that can be traded for something else you want or need.
The first thing to remember when discussing currency is that money and currency are not the same thing. Money is a type of currency, but not all currency is money. Although money and currency are often used interchangeably, they have different meanings and characteristics. Money has value in itself (intrinsic value) while currency has value because it represents something else that holds actual value (extrinsic value).
Currency was originally created out of necessity as an equivalent to barter trade. However, what people are willing to accept as payment varies greatly with location, time, situation, and individual. Because each person values things differently, one cannot simply offer anything they have to another person in exchange for what they want. Barter trade allows people to trade one good or service for another without the use of money or currency, but it’s not always easy to find two people at the same time with items or services that both parties want and agree on their respective values
1. What is a Cryptocurrency?
A cryptocurrency is basically a digital or virtual currency that works as a medium of exchange. It uses cryptography to secure and verify transactions, as well as to control the creation of new units of a particular cryptocurrency. A cryptocurrency exists only in digital form and hence cannot be physically exchanged like paper money or gold.
This does not mean that cryptocurrencies are not real assets, but rather that cryptocurrencies can only be digitally transferred between people and organizations. Examples of cryptocurrencies include Bitcoin, Ethereum, Ripple, Stellar and Litecoin.
Cryptocurrency is a digital currency or asset that uses cryptography to secure the transactions. These cryptocurrencies make the use of blockchain technology, which is a decentralized ledger that maintains a shared list of all the transaction dates and times in real-time.
Cryptocurrencies were first developed in 2009, with the introduction of Bitcoin by Satoshi Nakamoto. It was not widely accepted as a medium of exchange until 2014 when Mt. Gox, an online cryptocurrency exchange platform at the time was hacked resulting in a loss of 850,000 Bitcoins belonging to its customers and the company (although 200,000 Bitcoins were later found).
The Emergence of Cryptocurrencies
After the collapse of Mt. Gox, many new cryptocurrencies emerged with better security protocols and with different technological features than Bitcoin. Today there are over 1500 cryptocurrencies with Bitcoin holding the first position in market capitalization ($120 billion+), followed by Ethereum at $20 billion+ and Ripple at $8 billion+.
Cryptocurrencies are a form of digital money. They are based on the blockchain technology. This is a distributed ledger enforced by a disparate network of computers.
A defining feature of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation.
The first cryptocurrency to capture the public imagination was Bitcoin, which was launched in 2009 by an individual or group known under the pseudonym Satoshi Nakamoto. As of November 2017, there were over 1,100 cryptocurrencies available over the internet with a combined market capitalization of over $50 billion.**
Cryptocurrency is a digital currency that uses encryption techniques to regulate the generation of units of currency and to verify the transfer of funds. Cryptocurrencies operate independently from central banks, which makes them especially attractive for people who want to make transactions anonymously or without government interference.
In addition to functioning as an alternative form of payment, cryptocurrencies serve as investment opportunities for traders. Although cryptocurrency is still a relatively new asset class, it has grown tremendously since Bitcoin’s debut in 2009.
Cryptocurrency is a medium of exchange, which is created and stored electronically. This currency uses cryptographic encryption techniques to regulate its use and generate units. It is also a decentralized digital currency that is not controlled by any government or central authority such as banks.
The first cryptocurrency was Bitcoin, which was invented in 2009. Today there are thousands of cryptos available online and a few more offline. These currencies can be used for buying products and services, although some people buy them for investment purposes only. Some of the most popular cryptocurrencies include Ethereum, Litecoin, Ripple, Dash, Monero and Zcash.
Cryptocurrency market cap refers to the combined value of all cryptocurrencies in circulation today. For example: If you multiply the value of one Bitcoin by the number of Bitcoins in circulation today (16 million) you will get a total value of $104 billion dollars. This is called market cap because it represents the total amount of money that has been invested into the cryptocurrency market to date.
The easiest way to understand what market cap means is by comparing it with stock market capitalization or stock market value. The term “market capitalization” refers to the total value of all shares outstanding in a particular company at any given moment time. If you multiply the share price by