Short Introduction to Blockchain and Cryptocurrencies

 Blockchain technology has made a great stride in the past couple of years and the technology is rapidly developing at an exponential rate. The concept that one can store vast amounts of information on a digital ledger has gained popularity over time and so have numerous cryptocurrencies which use this technology to manage transactions on a peer-to-peer basis. In fact, blockchain can be considered as the platform for cryptocurrency and it’s the foundation of all other technological advancements. It can be said with absolute certainty that there are numerous ways through which this distributed system can help us move forward in many areas.

As per Forbes, the internet might have changed the world but it hasn’t really managed to change anything about how we work or operate. However, block-chain technology has made huge improvements in several fields and these include financial markets, healthcare and government records, public accountability, supply chains among others. If you think about any industry today, if it doesn’t involve money transfer, then chances are that some form of digitization will take place through blockchain in future so the best way to protect yourself from scams and fraud as well as reduce your workload.

The most recent development regarding this particular field of technology that would also prove useful is what is called Cryptocurrency. As per statistics and research, around 100 million people were already using the word Cryptocurrency last year alone across different platforms such as Facebook Messenger, Twitter, Reddit, Youtube etc.

One question arises here is “what are cryptocurrencies?” Well let’s discuss that again in detail. A cryptocurrency is basically a virtual asset on the internet and therefore is essentially a type of payment for goods and services which is not physically present in the physical world. While Bitcoin is usually regarded as the first popular decentralized digital currency, they are not the only ones. People around the globe started using coins in the early 1960s. They were mainly used as payment systems for various items. But over time, it began gaining popularity in terms of usage. This also led to the emergence of dozens of block chain related cryptocurrencies within a very short span of time. So, now the question appears — What are cryptocurrencies? Let’s go into details right at once!

In simple words, all cryptocurrencies basically function as virtual currencies. There are two types of cryptocurrencies, namely Digital Gold (Bitcoin) or Virtual Money (Ethereum). These are referred to as the initial stages of cryptocurrencies. Since people started thinking about these innovative types of currencies, many cryptos even came up after them. For example, Bit Gold was originally designed to compete against Litecoin, which had been accepted by major global banks. In addition to these two types of cryptocurrencies, it was suggested that users should choose between Bitcoin, Ethereum, Tether and USDT. Moreover, it is worth mentioning that the majority of the coins that are traded are actually based on their respective blocks of code.

It might be interesting to know more about what is bitcoin, the first decentralized digital currency? We will first take a look at the origin of bitcoins: ‘Bitcoin is often considered to be the mother of all cryptocurrencies because of its invention. The name of this currency came from a cryptography puzzle:

(image:https://www.pinterest.com/pin/3575983955134824)

This means that every successive generation of bitcoin would have more complex mathematical solutions for solving this cryptographic problem. That is why each person owning bitcoins has its own private key. Every single bitcoin is also assigned a unique address (like in the image below). Each transaction on the blockchain can be verified only when the owner addresses the public (or the node where he mined) public keys. Only the new owner would be able to see those addresses.

Since the creation of bitcoin through Satoshi Nakamoto in 2009, the number of bitcoins increased exponentially, but due to security issues many people were concerned about the reliability of these cryptocurrencies that rely heavily on network attacks and hacks. But the good thing is that as it stood now the value of Bitcoin is almost equivalent to $25000. So, it is safe to assume that the future looks promising for digital currencies.