Cryptocurrency
Cryptocurrency includes hundreds of different types of digital currencies. They are non-tangible items, and they are not regulated by any governing authority as yet. All cryptocurrencies run on blockchain technology, and the founder of this revolutionary new digital currency is regarded to be Satoshi Nakamoto. He, she or they invented Bitcoin. It was devised as a peer-to-peer cashless system to be transmitted over the Internet. The most important aspects of cryptocurrency are their decentralized nature and the open source code for peer-to-peer transfers. Cryptocurrency is grounded in decentralized filesharing. The most critical component of a cryptocurrency like Bitcoin is that there is no double expenditure with transactions. In a centralized system, transactions would be conducted by the server, but not so with a decentralized network.
Cryptocurrency balances are ‘like’ money in a traditional bank account, except that the only way a transaction can be amended is by meeting specific conditions. In this case, banks do not have the final say – it’s everyone on the network. Every single transaction has to work perfectly for cryptocurrencies to function effectively. This is done by way of private keys once somebody has a certain quantity of cryptocurrency, everybody on the network will be advised that that quantity has been transferred; this is how peer-to-peer technology works. A verify transaction is then concluded with the contracts, data and other records. This then creates a new block of data for the public ledger and it is added to the blockchain. Nothing can alter the blockchain – it is permanent. This then reflects on the user’s computer, smartphone or tablet.
Ironclad Transactions with Cryptocurrency
It’s important to understand that the digital currency a.k.a. cryptocurrency has no intrinsic value. You cannot redeem it for commodities like oil, silver, gold. It can be traded on exchanges for USD or GBP, only because trading platforms and traders assign value to it. It also does not have a physical form, meaning that you cannot withdraw physical coins or paper currency from your digital wallet or trading platform. More importantly, digital currency is not centrally controlled by a bank or government. It is imperative that all cryptocurrency transactions are confirmed on the network. Once that happens, it is ironclad.
