By: Razhan Kh. Mahmood

Friday 28th of June 2022

Berlin

All you need to know about Cryptocurrency

• You might know about the more popular versions, bitcoin and Ethereum, but there are over 5000 different cryptocurrency types in circulation. There are thousands of cryptocurrencies, the same way that there are thousands of currencies used by countries around the world. Bitcoin serves as a digital gold standard for the entire crypto-industry, is used as a worldwide medium of payment, and is a de-facto currency for cyber crimes such as darknet markets or ransomware. A cryptocurrency is a form of digital money that is an alternative form of payment created using cryptographic algorithms.
• The use of encryption technologies means that cryptocurrencies work as both currency and a virtual system of account. Cryptocurrencies are digital assets created using software on a computer network, which allows for safe transactions and property. Cryptocurrencies generally employ decentralized control, unlike a central-bank digital currency. Cryptocurrencies are popular partly because they eliminate central banks and governments from supplying the money.
• Cryptocurrencies can be used to pay for goods and services, and to invest in certain areas of the world. If you already have cryptocurrency, you can move it to an account from a digital wallet or another platform, and then use it for trading. You can hold it in an exchange or a digital wallet, such as one of the crypto wallets. You can make purchases using crypto, but this is still not a payment method that has mass adoption.
• It does not rely on a central bank but is instead a data set designed in general to function as a medium of exchange, using its core technology, blockchain. At the most basic level, a cryptocurrency is a digital asset that uses computer code and blockchain technology to operate somewhat independently, without requiring a central party–whether that is an individual, a corporation, the central bank, or a government–to run the system. It is the Internet version of money: uniquely-written pieces of digital code that can be transferred from one person to another. Cryptocurrency is decentralized by design, as opposed to traditional currencies, which are managed and controlled by a central authority.

The easiest way to think about cryptocurrencies is as a form of stored value (money) that is not tied up with governments or centralized institutions such as banks, states, or corporations. Cryptocurrency is a kind of digital asset, which is intangible, a digital money, which uses a very complex kind of cryptography called cryptography to protect and validate transactions, as well as control the creation of new units of currency. The second largest cryptocurrency by trading volume, Ethereum is a cryptocurrency network and software platform developers can use to build new applications, and has an associated currency called Ether. Digital wallets are used to store cryptocurrencies, says Kshitij Purohit, Head of Cryptocurrency and Commodities, CapitalVia Global Research. The worlds crypto market is expected to reach $2.73 billion by 2025

Innovation Behind Cryptocurrency

• The FinTech tutorial briefly covers cryptocurrencies (such as bitcoin) and blockchain technology (a protocol for peer-to-peer electronic cash systems). Blockchain opens up a variety of technology innovations, including trading in distributed exchanges on financial markets, making payments faster and safer, and validating confidential information. The technology behind Bitcoin and other virtual currencies, the blockchain is an open, distributed ledger capable of recording transactions between two parties effectively, in a verifiable, and permanent manner.
• Blockchain technology, the system of recording transactions over a network of computers around the world, is sometimes described as a shared digital ledger. Since blockchain technology was launched, Bitcoins blockchain has grown in capacity, such that numbers being played around are now above 3,500 000 TH/s. With a lot of Blockchains’s practical applications already implemented and being explored, the Blockchain is finally making its presence felt twenty-seven years later, and it is not only thanks to the Bitcoin network.
• While many applications are still in their research phase, there are many examples that show how Blockchain can be used. We have collected 30 examples of real-world blockchain use cases of this pragmatic but ground-breaking technology. Considered to be far from being a mature technology, blockchain is already being used for a range of real-world banking applications, including contract administration, real-time transparency, computation, and reporting, inventory management, sourcing, funding tracking, lending and borrowing, digitized assets, cryptocurrency, reconciliation and settlement [for securities and commodities trading], and secured land registry, says EYs Kapur. For instance, financial services companies may be using blockchain technology to write smart contracts between consumers and their banking institutions.
• The applications of this technology are not necessarily finance related; they could apply to any form of record-keeping; however, if the blocks relate to a financial transaction, each transaction on the Blockchain, by definition, includes information on prior transactions, thus proving the ownership of financial assets being transferred. While Bitcoin works because it is an entirely online system, where everyone involved agrees on ownership and provenance records, applications of blockchain to areas such as land records are more complicated because there is the need to register ownership of assets and link records with the physical world. With Blockchains ability to create greater transparency and equity, as well as saving businesses time and money, the technology is impacting various industries in ways ranging from the way contracts are enforced, to the ability for governments to operate more efficiently.

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