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The easiest way to know basic knowledge about cryptocurrency is through this article.
What is Cryptocurrency?
Currency is regarded as means of exchange for goods and services and that differs in different countries. It is stated as the money that we use and that is required by us to fulfill our different needs. The advancing technology has given rise to new types of currency and that is named cryptocurrency. It is a currency that is not available physically but it is a digital currency. It is new technology and thus an interesting topic for all.
Cryptocurrency, sometimes called crypto-currency or crypto, is any form of currency that exists digitally or virtually and uses cryptography for running secure transactions. Cryptocurrencies do not require a central issuing or regulating authority, instead use a decentralized system to record transactions and issue new units. It is supported by a decentralized peer-to-peer network called the blockchain.
Short History of Cryptocurrency.
1.) David Chaum an American Cryptographer was the first one to create electronic money or e-cash in the year 1983. This was brought into use by him in the year 1995 in form of Digicash. The earlier form of electronic payment required the use of software and encrypted keys for continuing any kind of transaction.
2.) Later, there was the invention of ‘B-money’, a distributed electronic cash system in the year 1998 by Wei Dei. Bitgold was further discovered by Nick Szabo. It was also an electronic currency system in which proof of work function was essential for all the users to cryptographically publish the same.
3.)Bitcoin which is regarded as the first decentralized cryptocurrency was then developed in the year 2009 by Satoshi Nakamoto. It required a cryptographic hash function and a proof of work scheme. Namecoin, Litecoin, and Peercoin were subsequently developed thereafter in the year 2011.
4.)The United Kingdom in the year 2014 ordered its financial department to conduct a study on cryptocurrency and also state the impacts that it can make on the nation’s economy.
5.)Recently in the year 2021, the government of China, which was stated as the largest market for cryptocurrency got crashed as the country declared all cryptocurrency transactions illegal. This incident also banned the working of intermediaries and miners in China.
Cryptocurrency has the following advantages: 1.)Funds transfer between two parties will be easy without the need of third party like credit/debit cards or banks. 2.)It is a cheaper alternative compared to other online transactions. 3.)Payments are safe and secured and offer an unprecedented level of anonymity. 4.)Modern cryptocurrency systems come with a user “wallet” or account address which is accessible only by a public key and pirate key. The private key is only know to the owner of the wallet. 5.)Funds transfer are completed with minimal processing fees.
Cryptocurrencies have the following disadvantages.
The almost hidden nature of cryptocurrency transactions makes them easy to be the focus of illegal activities such as money laundering, tax evasion and possibly even terror-financing.
Payments are not irreversible.
Cryptocurrencies are not accepted everywhere and have limited value elsewhere.
There is concern that cryptocurrencies like Bitcoin are not rooted in any material goods. Some research, however, has identified that the cost of producing a Bitcoin, which requires an increasingly large amount of energy, is directly related to its market price.
The easiest way to know basic knowledge about cryptocurrency is through this article.
What is Cryptocurrency?
Currency is regarded as means of exchange for goods and services and that differs in different countries. It is stated as the money that we use and that is required by us to fulfill our different needs. The advancing technology has given rise to new types of currency and that is named cryptocurrency. It is a currency that is not available physically but it is a digital currency. It is new technology and thus an interesting topic for all.
Cryptocurrency, sometimes called crypto-currency or crypto, is any form of currency that exists digitally or virtually and uses cryptography for running secure transactions. Cryptocurrencies do not require a central issuing or regulating authority, instead use a decentralized system to record transactions and issue new units. It is supported by a decentralized peer-to-peer network called the blockchain.
Short History of Cryptocurrency.
1.) David Chaum an American Cryptographer was the first one to create electronic money or e-cash in the year 1983. This was brought into use by him in the year 1995 in form of Digicash. The earlier form of electronic payment required the use of software and encrypted keys for continuing any kind of transaction.
2.) Later, there was the invention of ‘B-money’, a distributed electronic cash system in the year 1998 by Wei Dei. Bitgold was further discovered by Nick Szabo. It was also an electronic currency system in which proof of work function was essential for all the users to cryptographically publish the same.
3.)Bitcoin which is regarded as the first decentralized cryptocurrency was then developed in the year 2009 by Satoshi Nakamoto. It required a cryptographic hash function and a proof of work scheme. Namecoin, Litecoin, and Peercoin were subsequently developed thereafter in the year 2011.
4.)The United Kingdom in the year 2014 ordered its financial department to conduct a study on cryptocurrency and also state the impacts that it can make on the nation’s economy.
5.)Recently in the year 2021, the government of China, which was stated as the largest market for cryptocurrency got crashed as the country declared all cryptocurrency transactions illegal. This incident also banned the working of intermediaries and miners in China.
Cryptocurrency has the following advantages: 1.)Funds transfer between two parties will be easy without the need of third party like credit/debit cards or banks. 2.)It is a cheaper alternative compared to other online transactions. 3.)Payments are safe and secured and offer an unprecedented level of anonymity. 4.)Modern cryptocurrency systems come with a user “wallet” or account address which is accessible only by a public key and pirate key. The private key is only know to the owner of the wallet. 5.)Funds transfer are completed with minimal processing fees.
Cryptocurrencies have the following disadvantages.
The almost hidden nature of cryptocurrency transactions makes them easy to be the focus of illegal activities such as money laundering, tax evasion and possibly even terror-financing.
Payments are not irreversible.
Cryptocurrencies are not accepted everywhere and have limited value elsewhere.
There is concern that cryptocurrencies like Bitcoin are not rooted in any material goods. Some research, however, has identified that the cost of producing a Bitcoin, which requires an increasingly large amount of energy, is directly related to its market price.
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