advertisement

What is Cryptocurrency? | A Brief Explanation To Cryptocurrencies

what is cryptocurrency | what are cryptocurrencies | list of cryptocurrencies | bitcoin cryptocurrency | ethereum cryptocurrency

What is Cryptocurrency?

Question of the year. Surely was a question of the previous years too. Maybe for future years as well.  Yes, everyone is asking here and there about Cryptocurrencies. Everyone is keen to know about it. But only a handful of people know about it and its power to change the present systems of making monetary transactions. It’s like if  WhatsApp is a punch to text messages, Cryptocurrency is a jab to Fiat Currency.

Cryptocurrencies, also known as many other terms like Kryptovaluta, were invented after Bitcoin came around in 2009. Ethereum is the 2nd known cryptocurrency to be created and launched.

Decoding Cryptocurrency?

A Cryptocurrency, as the name suggests, is a secret/hidden currency that exists in the records called a public ledger, just like the balance in your bank account’s passbook, talk time in your mobile phone, DTH, etc.

It cannot be physically seen or felt but is used for online transactions, making and receiving payments, just like internet banking.

A cryptocurrency is a digital or virtual currency that uses cryptography for security.

Cryptography or cryptology is the study and practice of techniques to communicate securely in the presence of third parties.  Using the code language that only those people know, to whom the codes have been informed, this technique of securing the information to be passed is known as Encryption.

Just like the code languages used in James Bond, Mission Impossible movies !!!!

More specifically, cryptography is about creating codes for data, that prevent third parties or the public from reading private messages.

Difference between Cryptocurrency and Fiat(traditional) Currency:

A cryptocurrency is usually in a digital form, unlike fiat currency which is in physical form.

Another difference, which is one of the most defining features of cryptocurrency is, that it is decentralized. It means no government or bank has control over it. It has its own value and is based upon the demand and supply for it in the market. Just like gold, it has its own value.

Again, different from Fiat Currency in a huge way.

So if no government or bank has control over it, how does it come into existence??? A big question that must be forcing you to scratch your head, right??

The first decentralized cryptocurrency, Bitcoin, was created in 2009 by an individual or group of individuals known as Satoshi Nakamoto. It uses SHA-256, a cryptographic hash function, as its proof-of-work scheme.

Other cryptocurrencies, followed Bitcoin and came into existence more or less in a similar way to it, with some changes, in order to differentiate and compete with each other.

So by now, I am sure you might be clear about the concept of Cryptocurrency to some extent. You may be having some doubts, but still a bird name Cryptocurrency is now known to you. After reading the above information you might be fascinated about this new thing which will drastically change the future of money. Well, you are not alone! Cryptocurrencies are gaining huge popularity and are even accepted as payments by big names, such as Microsoft,Wordprss,Overstock.com,Expedia.com, etc. (Click here to view a list of companies accepting Bitcoin)

As of now, more than 700 cryptocurrencies are trading in the market, but only a few of them are gaining popularity. Bitcoin is the most popular cryptocurrency as of now.

Click here to view a list of some cryptocurrencies.

For more updates about Cryptocurrencies, visit our Cryptocurrency Section.

KryptoMoney.com posts the latest news and updates about Cryptocurrencies, Bitcoin, and Blockchain Technology. Subscribe to our newsletters and connect with us socially on TelegramFacebookTwitter, and Instagram to stay updated.

Get Latest Cryptocurrency And Bitcoin News

Signup this form below to get latest Cryptocurrency and Bitcoin news, directly in your mailbox

Note:

Keep in mind that we may receive commissions when you click our links and make purchases. However, this does not impact our reviews and comparisons. We try our best to keep things fair and balanced, in order to help you make the best choice for you.