As we movie with the tide of technology, the 21st century seem to be miles ahead in terms of innovation and invention. Everything from a cog to an engine seems to be changing and getting new shapes and themes every day. Whether it is economy, finance, technology, capital, mobile phone, software, hardware, transportation, internet, every aspect, every accessory to life is being remodeled and reshaped in a way that has never been done before.
And the most frequent and common means of living is also not untouched either. The way we use our transactions, our currencies, our finances has gone an overwhelming change, and it has revolutionized the entire scheme of finance in a completely unprecedented way.
The currency is one such thing which affects the countries at large, and the entire finance is build on the foundation of currency. It is the main mode of transaction. Like earlier barter used to be the base, now the currency is in place. And it has seen all from low to the top. When everything seems to be mutated by technology, then how can the currency remain untouched. That another modified model of technology is called cryptocurrency.
Cryptocurrency in the most simplified of terms can be called as cryptocurrency. It is made with cryptographic protocols that make the transactions. And these protocols are very highly secured. It is a very highly refined medium of exchange that uses very strong cryptography, so the transactions are very difficult to fake.
Cryptocurrency is a very recent technology with the advancement of the modern age. David Chaum, an American cryptographer first came up with electronic form of money in 1983. And then he used digicash to implement it. And then MIT published various papers on the research of cryptography. Then in the year 2009 the first cryptocurrency was created by Satoshi Nakamoto. Then in 2011 Namecoin was created. And then various other also came into function like Litecoin, Peercoin etc.
Upon the introduction of the first Bitcoin, it was said by its official address that,
Announcing the first release of Bitcoin, a new electronic cash system that uses a peer-to-peer network to prevent double-spending. It’s completely decentralized with no server or central authority. – Satoshi Nakamoto
The most important aspect of cryptocurrency is that it uses a decentralized version of transaction process. Hence no central authority is required. Ownership is exclusively cryptographically. And the verification is very strong. Because the entries are in the form of a database that no one can change easily, without having fulfilling certain conditions.
It is a system of databases. Basically it’s a p2p transaction because every peer has a record of the history of all the transactions and balance. When the transaction is made, then it’s broadcasted in the network and sent from one peer to another. And then after some time it gets confirmed. Once it is confirmed, it becomes part of the blockchain.
The role of the miners in a cryptographic currency is to confirm the transaction. They carry out the transactions, spread them in the network, and after they handle the confirmation, it becomes part of the blockchain.
They carry out one of the major functions in cryptography and they have rewards in the form of currency units like bitcoins.
It has a major role in preventing one party from abusing it. Everyone dealing in the transaction can be a miner as there is not central authority in cryptocurrency. The need to create special kind of hash from their computers to put an effect into this. The purpose is to create blocks that can be further added into blockchain.
PROPERTIES OF CRYPTOCURRENCY
- When the founder Satoshi created it, he used a pseudonymous name for it and that has been the prime feature of cryptocurrency. It does not use real identities for transactions, but pseudonymous names and bitcoins addresses.
- The transactions are very fast and efficient
- Once the transaction is added to the blockchain it cannot be reversed
- It has a global appeal
- It is very secure and cannot be forged
- It is not governed by any central authority or governments
EXAMPLES OF CERTAIN CRYPTOCURRENCIES
TERMS ASSOCIATED WITH CRYPTOCURRENCY
The addresses such as public or private keys which are used as modes of transaction are wallets.
A very big term that is used in cryptocurrency. It is a list of records called blocks carrying all the history of transactions and balance. It contains a hash pointer which acts as a link to the previous blockchain.
It is a method of securing a cryptocurrency network. The first scheme invented was proof of work scheme. The most widely used schemes are SHA-256 and scrypt.
Some others include mining, graphic cards etc.
A VISION OF A NEW ECONOMY
CRYPTOCURRENCIES are a fast way to organize the transaction business and has a worldwide reach and influence. And due to its independence and security is the new mode of economy that could add to the already transformed economic scenario.
The future could lie in this aspect of transaction and that day is not far away when the governments begin to look into this frame as well. And already it is slowly proving its mettle in the financial world by adding a lot of value to the economic sector.
The prime need of humans is to make their work as comfortable and secure and if they can get something more assured than the banks then their most worked aspect of living can be taken care of. Cryptocurrency provides economic stability and also it gives the private individual the right over his own dealing and transactions without the interference of any centralized figure as it should be.