The world is enthralled by it, and the world can’t seem to get enough of it. The phenomenon that is cryptocurrency continues to make waves around the world and reinventing the way we interact with each other in our business and personal lives. This industry which was once seen as a mere geek idea that was going nowhere has now exploded into the mainstream with the whole industry worth over hundreds billion as at the time of writing this. So what is all the fuss about? Consider this Cryptocurrency 101
Definition of Cryptocurrency
A typical cryptocurrency can be defined as a decentralized, stateless and borderless virtual currency that gives people the ability to conduct peer to peer transactions, transferring value from one corner of the world to another without resorting to banks, middlemen or any sort of payment provider at any stage of the transaction. A cryptocurrency is a product of high scale cryptography and is usually produced as a result of the solving of humongous amounts of mathematical puzzles by computers in a process known as mining.
The Blockchain Technology
The blockchain technology is the basic infrastructure upon which cryptocurrencies are created and as such, it is only fair to go over it first. The blockchain technology is a distributed public ledger system upon which transactions of anything of value, from money, tokenized titles of property or any other thing for that matter can be recorded following strict verification processes. The blockchain in most cases is run on a decentralized network of computers spread all over the world which help in ensuring the validity of each transaction. The key feature of the blockchain technology is in the fact that it is completely incorruptible, and sabotage resistant, as the sheer amount of computational power needed to compromise it, is not owned by any single entity on earth.
The First Cryptocurrency
The whole cryptocurrency universe came to life in 2009 with Bitcoin being the first in the industry. It was created by a person or group that goes by the name Satoshi Nakamoto. The Bitcoin source code laid the ground for the rest of the industry to take root. It is made up of an open source code that is run in a decentralized network called the blockchain. This decentralization is one of the key points of strength of cryptocurrencies, as due to the fact that there is no single point of failure on any given blockchain it is virtually impossible to sabotage or compromise the network in any way.
Cryptocurrency transactions are conducted completely over a peer to peer network which means no third party is required whatsoever for person A to send an amount of money to person B. These transactions are conducted using dedicated software and hardware known as Wallets. These wallets act both as day to day purses from which the cryptocurrency holder receives and sends money, and also act as the bank in which the digital assets are stored for long-term purposes.
Below are some videos to provide you a better understanding of cryptocurrencies.
Index of industries being changed by blockchain: