The appearance of Cryptocurrency has taken over in our daily transaction. Cryptocurrency is a digital asset in the world of Crypto with many who refer it as’ digital gold ”. But what exactly is cryptocurrency? You have to wonder.
This is a digital asset that is intended to be used as an exchange media. Obviously, this is a substitute for a close money. However, it uses strong cryptography to secure financial transactions, to verify the transfer of assets and control the creation of additional units. All Cryptocurrency is a virtual currency, digital currency or alternative currency. It is very important to note that all cryptocurrency uses a decentralized control system as opposed to a centralized bank system and other financial institutions. This decentralization system works through distributed ledger technology that presents a public financial database. Usually, Blockchain is used.
What is Blockchain?
This is a list of notes that continue to be linked and secured using cryptography. This list is called a block. The block chain is a ledger that is shared, distributed which can be used to record transactions between two parties in a verified and permanent way. To activate blocks to be used as a ledger distributed, managed by a peer-to-peer network which collectively adheres to the protocol for new block validation. After the data is recorded in any book, it cannot be changed without changes in all other blocks. Therefore, Blockchain is safe with design and also acts as an example of a distributed computing system.
David Chaum, an American Cryptographer found an anonymous cryptographic electronic money called ECASH. This happened in 1983. In 1995, David applied it through Digicash. Digicash is an initial form of electronic payment cryptography that requires user software to attract records from the bank. It also allows specific encrypted button designation before sending to the recipient. This property allows the digital currency so that it cannot be traced by the government, a publisher or any third party.
Following an increase in efforts in the following years, Bitcoin was created in 2009. It is the first decentralized cryptocurrency and created by Satoshi Nakamoto, Somaton developer. Bitcoin uses SHA-256 as its cryptographic hash function (evidence scheme). From the release of Bitcoin, the following Cryptocurrurity is also released.
1. Namecoin (April 2011)
2. Litecoin (October 2011)
These three coins and many others are called Altcoin. This term is used to refer to the alternative variants of Bitcoin or other Cryptocurrency.
It is also important to note that Cryptocurrency is exchanged through the Internet. This means its use is mainly outside the banking system and other government institutions. Cryptocurrency exchanges include Cryptocurrency Exchange with other assets or with other digital currencies. Conventional Fiat money is an example of assets that can be traded with Cryptocurrency.