hokkaido inu

What are cryptocurrencies?

“Cryptocurrency are digital means of payment, often decentralized and intended as an alternative to existing currencies such as the Euro (€) and Dollar ($) . Cryptocurrencies have predetermined rules around the maximum number of coins (coins) that can exist within the specific currency. Security is guaranteed thanks to the use of cryptography for hokkaido inu.”

That’s the official definition. But is cryptocurrency the future or is it just a bubble? Almost every major bank or technology company is investigating whether they should adopt the technology behind cryptocurrency.

In this article, we will explain what you need to know about cryptocurrency. But we also answer the question of whether it is a good investment and how you can purchase it. We will explain it in the simplest way possible and after reading the article you will know more than 90% of your colleagues and friends.

How did it begin?

Before we explain exactly what it is and especially what you can do with it, it is important to explain how the entire market of different cryptocurrencies came into existence. This started with the introduction of Bitcoin. Developed by Satoshi Nakamoto, it was intended as a new currency for a new monetary system. A system outside the established banks. However, no one knows who Satoshi Nakamoto is as it is a fake name. No one knows who is hiding or going behind this alias.

So it all started with Bitcoin. We are now many years further and there are several variants of Bitcoin, of which Bitcoin Cash (BCH) is the most famous. This variant arose after a so-called “hard fork”.

At an earlier stage, attempts have been made to develop digital currencies (Digicash, Flooz). However, these projects never became successful. One problem that was encountered was that of ‘double spending’:

Suppose I have five hundred euros. I buy a TV like this in cool blue worth 480 euros. I only have 20 euros left. If I now want to order a surround set worth 300 euros, this is not possible, because a central organization (in this case the bank) can read from its database that I do not have enough money. This was a problem with digital currencies, there was no organization that could determine whether you actually had that money for a transaction. And since the whole idea of ​​cryptocurrency was ‘decentralization’, there was no solution to this for a long time. That has now changed.

Blockchain

Blockchain technology opened the gates for cryptocurrency. This goes like this. Cryptocurrencies work on blockchain technology. There is a database where all information is stored, but this cannot be adjusted by a central person or company. Changes in the database happen with the help of the entire network. A network consisting of countless computers. Computers all process and verify part of a piece of information.

Because this network consists of thousands of computers that all work independently of each other, information cannot be manipulated. This creates a decentralized body that works just as objectively (or actually more objectively) than a central organization.

The image below shows in which industries blockchain and cryptocurrency can be used.

There are now more than a thousand different digital currencies, also known as altcoins. Altcoins is the name for all existing cryptocurrencies, except Bitcoin. Some of these work on their own network and some of them exist on an existing blockchain network. The difference between all these cryptocurrencies is that they have different ideas and uses. There are also major differences in how quickly transactions are processed. With some coins this is within 8 seconds, others take many minutes.

The most well-known crypto coins we know today are Bitcoin (BTC), Ethereum (ETH) , Litecoin (LTC), Ripple (XRP), Monero (XMR) and Stellar Lummens (XLM). Almost all of these payment methods enable peer-to-peer payments. Ripple has focused specifically on the banking sector.

Leave a Reply

Your email address will not be published.