Still don’t have any idea about cryptocurrency and how it works?
As an internet user, you have to have a little bit of knowledge and information about digital money, currency, and how it can provide benefits to anyone in 2022.
After the financial crisis in 2008, people were waiting for a new form or a new system of money that will rub out the flaws and limitations of normal regular currencies.
Then, Bitcoin arrived, the best-known cryptocurrency, and began changing the global economy and has been changing it precisely.
So, without wasting any single second, let’s learn all about cryptocurrency, cryptography, and Bitcoin in detail.
What Is Cryptocurrency?
Cryptocurrency is a digital, virtual, and untouched form of payment system that is designed to be used by anyone across the internet from anywhere.
It is a peer-to-peer method of transaction for sending and receiving payments that doesn’t rely on any centralized organization like the Bank to confirm the transactions.
Moreover, it is totally secured and assured by cryptography.
What is Crypto, Cryptography In Cryptocurrency?
According to Google dictionary, the meaning of Crypto is secret, undisclosed, restricted, or concealed.
Now, we can understand easily that it is a process of hiding sensitive messages and data that are kept secret for the intended beneficiary.
You already know that the meaning of crypto is secret and the other word and graphy means field or study that is related to writing something in a book.
To sum up, the meaning of Cryptography is a science, technique of studying secret writing, especially codes and texts like cyphers.
And this whole system happens through encryption and decryption.
But, a question comes: Why Cryptography is used in cryptocurrency?
To get a proper answer you need to understand the fact that although the internet is secured and safe, there is still a minor chance of hacking.
Besides, when it comes to sending and receiving money nationally or internationally, you want to be 101% secure.
Now Cryptography comes into play. It guarantees powerful security while making transactions and to break that security system is next to impossible because of the private and public key and hashing process.
Currency means a medium of exchange for goods and services.
So, cryptocurrency is a digital, decentralized currency that is secured by cryptography and which runs on Blockchain technology.
How Does Cryptocurrency Work in 2022?
It may take some time to learn how cryptocurrency works because it is a little bit complex process.
You already know that there is no control of banks or governments. Therefore, it proceeds on a distributed public ledger which is called, in technical terms, a blockchain that records all the transactions made by currency users.
In simple words, a public ledger is a note-holding system that maintains cryptocurrency balance, transaction history between participants, and all the related data.
Peer to peer network:
And, the public ledger which is normally maintained by unlimited computers and persons is called person to person network.
Yes, not a single person or computer, countless people and systems maintain it.
But the question comes: how is it maintained?
The answer is blockchain, revolutionary technology.
Let’s imagine only one person is maintaining the ledger. She/he can do whatever she/he wants. He can mismatch, and steal the information.
So, the solution is blockchain which provides top-class security by holding all those interconnected transaction histories. These histories are all available on public computers.
At the time, if anyone tries to cheat or fraud, that can be tracked easily.
Miners and Mining:
A mining process is a method by which transactions are confirmed, certified, and approved digitally and added to the blockchain ledger.
And, a person uses powerful software to do the mining process.
What Is Bitcoin?
We have already mentioned that it is a virtual currency that was introduced in 2009 to the world and the most popular cryptocurrency was Bitcoin.
You know that it is totally virtual money that cannot be touched and used physically, but you can save it in your digital wallet and transfer it to another wallet.
Therefore, you can call it an online currency. It is not that there is only one cryptocurrency which is Bitcoin. But, there are 5000+ different cryptocurrencies at the present moment.
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Some well-known cryptocurrencies are:
- Shiba INU
Naturally, you can invest in these currencies and, like Bitcoin, you can buy and sell these currencies. ( Note: Buy and Sell in your own risk.)
But, the interesting fact is that not only Bitcoin is popular but the popularity is still getting higher and higher every day because some established companies started accepting Bitcoin as a payment method.
Because of that in the near future, we can use Bitcoin for shopping, trading, traveling, food delivery, etc.
Is Cryptocurrency Legal Or Illegal?
There was so much hesitation in everyone’s mind about whether cryptocurrency is legal or not. If you know it or not, the RBI banned cryptocurrency in 2018.
However, in March 2020, the Supreme Court forbade the ban mentioning that it is legal. Even, all cryptocurrency activities like investment and trading are made legal in the country.
That is why there is the hype about cryptocurrency and Bitcoin in India along with other countries.
Benefits Of Cryptocurrency?
According to our old school perspective, we think investment means Mutual Funds, FD, Gold, and Shares. Yes, they are not wrong, but in this changing era, we will get different benefits from digital currencies.
- Privacy: If the money is ours, why will any third person like Bank, Authority, or Agency control it? Anytime we can suffer from inflation, ups, and downs of values of different currencies. Cryptocurrency is a decentralized structure that keeps your money out of the hands of the government.
- Easy transaction: Now doing transactions digitally is not rocket science. Just like UPI payments, we can do transactions easily and efficiently in no time.
- International transaction: Doing international transactions gets easier and you don’t have to pay extra as it takes very small cuts.
- No middle man: There will be no middle man or third party people like merchants, brokers, or agents. So, you get double security.
- Secure transaction: Bitcoin uses cryptography and powerful algorithms that provide extreme security.
What are the Disadvantages Of Bitcoin?
- It is not controlled by any government or verified authorities. So, if you have any problem or complaint, where will you go, there is no one to listen to.
- It is a secret currency. So it is also used for unethical payment.
- And it requires so much energy and tools for mining.
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Top Bitcoin Users In 2022
However, few countries are not using crypto, still, there are lots of benefits. Besides, it’s not a new concept: Facebook, Amazon, Walmart, and PayPal, all these big companies are connected to cryptocurrencies.
Moreover, the richest person in the world, Elon Musk personally tweeted: “Bitcoin is my safe word. “
Even, there are more great personalities like
- Bill Gates.
- Paris Hilton.
- Kenya Waste.
- Jack Dorsey.
- Mike Tyson.
- Steven Seagal.
- 50 Cent.
- Mark Cuban.
- Snoop Dogg.
- Maisie Williams owns Bitcoin.
So we have shared all the information that you need to know about cryptocurrency, Cryptography, and Bitcoin.
Yes, it will be a bit harder for you to learn about all these technical things in Crypto, but it is not that hard.
So, comment below: Are you going to be a cryptocurrency user?