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What is cryptocurrency?

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Written by   70
9 months ago

Cryptocurrency is a type of digital currency. This currency is not produced or supplied by any government or state. Mining has to be done by connecting to the internet through these different hardware. And in this mining process one has to make coins by completing all the complex algorithms, blocks and cryptography. Efforts to invent cryptocurrencies have been going on for a long time. Researchers learned in the eighties that it was possible to invent such a coin from cryptography. But they failed to solve some problems. In 2007, an unknown researcher sent a research paper to an internet forum with a solution to those problems. Surprisingly his solution comes in handy. His solution is called blockchain. The various processes of the blockchain algorithm take very little time (say 5 minutes) to generate a coin at first, but its difficulty increases over time. This shows that it takes 15 days or more than 30 days to generate a coin. And with this difficulty, the coin rate increases. Examples: Bitcoin, OneCoin, Litecoin, Ripple, Dogecoin etc.

We are all familiar with the common currency. These are such as money, rupee, euro, dollar, pound etc. All these currencies vary from country to country. They are produced and controlled by the government or the central bank. The supply of this currency can be increased or decreased at will. But each cryptocurrency cannot generate more than a certain amount of coins. Onecoin, for example, can generate a maximum of 2.1 billion coins. Just as the value of our common currency, the money, the dollar, is not the same and the value is not constant, so the value of all cryptocurrencies is not the same and the value is not constant. As far as is known, when Bitcoin was first in the market, its starting price was around .10.

I am sharing with you a funny and sad incident at the same time

In May 2010, a man named Lazlo Heinz bought two cages with 10,000 bitcoins in his possession. This was the first time Bitcoin was the first product to be purchased. He did not understand the future of bitcoin. In just 3 years, the price of each bitcoin is about 1200 USD. If 1 btc = 500 $ then the value of 2 cages is 50,00,0,00 $ !!!!!!!!!!!!!!!!!!!!!!!!!! Alas for that Lazlo who could have been a millionaire, he could not be anything but a victim of misfortune.

The recent incredible explosion in the value of Bitcoin has shaken everyone. No one can play it anymore. Bitcoin futures are allowed to be sold on the Chicago Exchange. Many well-known organizations, including Merrill Lynch and Bank of America, say it's not a bubble. There are definitely reasons behind this price increase. Because it is very deep. More technical and scientific than economic. Blockchain has already been adopted as a new potential technology.

What is the need for bitcoin or crypto currency?

As society and life move forward, so does the advancement of science and so do economic instruments. There has been a lot of evolution in the thing called currency. From gold, silver or coinage it has become paper money. Advanced technology is being used to prevent counterfeiting. Then L credit card, debit card. With that, economic exchange became easier. These can be called 'digital currencies'. But cryptocurrency has brought the most unimaginable progress. Let's highlight some of its characters.

1. It has no government or institution. Huge populations around the world are circulating these currencies through a kind of secure network. No one is a policy maker, everyone is equal, just a node in the network. This coin will go from buyer to seller directly, without any intermediary, safely and surely. There is no central form of this monetary system, there has been complete decentralization. This is called a direct peer-to-peer network.

2. Bitcoin allows anyone to buy anything from Ghana to China in an instant. No matter the bank, no matter the exchange rate. There is no middle ground, that is the design of this coin.

3. This currency can be quickly moved from one country to another. Bitcoin takes a maximum of 10 minutes. But some other cryptocurrencies may change hands in less time. However, in the current currency transfer system, it takes a few days to move from one country to another.

4. There is a nominal fee to send this coin from one person to another. It does not depend on the amount of money sent again. The same fee for sending one bitcoin and one lakh bitcoins. The current money transfer costs a lot of money.

5. Cryptocurrency transactions cannot be forged. Once transferred, it cannot be returned or changed in any way. In different countries of the world, it is being recorded on thousands of machines. This transaction is irreversible.

. Cryptocurrencies have no inflation. The number of these coins is predetermined, so they can no longer be printed like money. Different countries are trying to increase their purchasing power in the international market by printing more of their currencies openly or secretly, resulting in a currency war. In cryptocurrency this is absolutely impossible. The maximum number of bitcoins is set at 2.1 crore.

Why is Bitcoin so valuable?

There are several reasons for the rise in the price of Bitcoin. These include:

1. It is thought that in the near future everyone around the world will use cryptocurrencies. To put it another way, if someone said 20 years ago that everyone around the world would use a mobile phone, it might not seem very believable then. Many feel that this is exactly what is happening here.

2. The number of bitcoins is limited. So even if the price of a bitcoin is much higher, it is not surprising. Because, all the resources of the world have to be bought with that limited bitcoin, so the price of each one will be skyrocketing.

Is it possible to buy anything with bitcoin?

Many things can be bought with Bitcoin nowadays. For example, any product can be bought through Bitcoin from Overstock.com. Many more such businesses are now using Bitcoin as a currency. The idea is that just as credit cards are being used instead of money now, in the future money and credit cards will be replaced by bitcoin or some other symbolic currency

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