Cryptocurrency : The Truth about It
Have you heard the word cryptocurrency and wondering what is something about it? No wonder you are curious because nowadays cryptocurrency suddenly become a household name and people using it enjoys its flexibility, reliability and fast transaction. What is great about cryptocurrency is that every transaction is private. You don’t need to pay for a third party because you don’t need a third party at all.
What is Cryptocurrency?
Let us define cryptocurrency from the word itself.
Crypto – combining form – secret, hidden, or concealed: cryptography,crypto-fascist
Currency – a system of money in general use in a particular country.
Simply put cryptocurrency means “secret money”.
Cryptocurrency is a medium used in exchanging goods and services just like normal currencies works like dollars, yen and other currencies from other countries. However, this one is designed in a digital form. Whereas, exchanging of information made possible by the use of cryptography principles. This is meant to keep the transactions private and to keep it safe.
Bitcoin is one example of cryptocurrency and the first one that has been created way back 2009.
Reasons why Cryptocurrency was Born
In this era, people find it convenient to use electronic devices such as credit cards in their transactions. They even take advantage of the web to make online transactions. They buy goods, pay services and bills without bringing cash and just by swiping their cards or with just a few clicks on the web.
The reason why people like to do their transactions in a cashless manner is because it is fast and safe for them. With this cryptocurrency was born. You can make your transaction even faster and safer because it is more private than the traditional way.
Cryptocurrency is a choice you have to have over limited currencies that is being issued traditionally by your government. You have now a choice on whether to use currency or you can just choose crypto currencies to your transactions or you can have both. The power to choose is a big deal for us, being able not to settle to limited choices or to no choice at all.
One thing that cryptocurrency stand apart from the traditional currency is that it isn’t centralized which means that you can make your transaction free of charge. Unlike traditional currency which is centralized. With traditional currency you need to do your transactions with the help of third party such as banks and other authorized financial institutions and because of this, you are being charge per transaction that you make.
See illustration below.
Crypto currencies on the other hand weren’t issued by any public authority or a central bank, but it is accepted by legal people as means of payment for any services rendered or goods. This is a digital representation of value which can be stored, transferred or traded electronically. This can be exchanged, moved and transferred without needing for any specific information and it leaves no trails or just a few in the economy. The transaction is quick, no matter how much the amount is.
Cryptocurrency is a digital currency, which has lines of code that has monetary value. This is a secured transaction which based on cryptography principles. The technical system was created by Satoshi Nakamoto and this is where all crypto currencies are based on.
This electronic currency is designed for person to person transaction and an open source for everyone. You can view crypto-currency as internet money or a coin, but the mere sense of it is, it is being used for an exchange system.
Government doesn’t have any control over it. Crypto currency is maintained by cryptocurrency miners’ community. These are members of the public group that have ASIC machine or have their computers set up to participate in the transactions processing and validation.
Unlike fiat currencies, crypto currencies have limits in productions which will create a market cap on them. Inflation will never be a problem. Bitcoin is limited to 21 million coins.
Crypto currency has different specifications but they are all come in 2 protocols, and they are the “proof of stake” or “proof of work”.
The internet changes everything in our lives. It changes the way we communicate, it changes the way we gathered news and where to rely for information. It also changes the way we advertise, book are travels and the way we shop. Now that internet is accepting cryptocurrency, it will change the way we buy things and exchange services and goods. With crypto currency, you have an alternative.