Cryptocurrency is a digital asset that is designed to be a medium of exchange that uses strong cryptography to protect financial transactions, control the creation of additional units, and validate the transfer of assets.
Currency currencies use decentralized control compared to centralized digital currency and central bank systems. Decentralized control of each cryptocurrency works through shared ledger technology, often a blockchain, that serves as a public and financial transaction database.
It is generally considered Bitcoin, first released as open-source software in 2009, as the main decentralized crypto currency. From the debut of bitcoin, more than 4,000 altcoins (alternative forms of bitcoin, or other cryptocurrencies) have been created.
History
In 1983, American cryptographer David Chaum created an anonymous cryptographic and electronic currency named ecash. In fact, in 1995, it implemented it through Digicash, a prototype form of cryptographic and electronic payment that requires user software to extract paper money from a bank and assign specific encrypted keys before sending it to a recipient. This allowed the digital currency to be impossible to find by the issuing bank, government, or any third party.
In 1996, the NSA published a paper entitled How to Make a Mint: the Cryptography of Anonymous Electronic Cash, which describes the cryptography system first published in an MIT mailing list and subsequently in 1997 in The American Law Review (Vol. 46, Issue 4).
In 1998, Wei Dai published a description of "b-money", which is classified as an anonymous, distributed electronic money system. Shortly thereafter, Nick Szabo described bit gold. Like bitcoin and the other cryptocurrencies that follow, bit gold (as opposed to future gold-based exchanges, BitGold) has been described as an electronic money system that requires users to complete a proof of work function with cryptographic solutions compiled and published. Hal Finney created a monetary system based on a proof of work that was used repeatedly following Dai and Szabo's activities.
The first decentralized crypto currency, bitcoin, was created in 2009 by fictitious developer Satoshi Nakamoto. It used SHA-256, a cryptographic hash function, as its proof-of-work scheme. In April 2011, Namecoin was created as an attempt to develop a decentralized DNS, which would censor internet censorship. Shortly thereafter, in October 2011, Litecoin was released. This is the first successful cryptocurrency to use scrypt as its hash function instead of SHA-256. Peercoin, another notable cryptocurrency, was the first to use a proof-of-work / proof-of-stake hybrid.
[16] On August 6, 2014, the United Kingdom or the UK announced that its treasury had been tasked with conducting a study of the cash crops, and the possible role, if any, in the economy of the United Kingdom. This study also reports on whether regulation should be considered.
Formal definition
According to Jan Lansky, a system that fulfills six basic cash transactions: [18]
The system does not require a central authority, its state is maintained by consensus.
The system maintains an overview of the cash-flow units and their ownership.
The system determines whether new cryptocurrency units can be created. If new units of the crypto currency can be created, the system determines the circumstances of their origin and how to determine the ownership of these new units.
Ownership of cryptocurrency units can be verified by cryptographic method only.
The system allows transactions to be performed where the ownership of cryptographic units is changed.A statement of transaction may only be issued by an institution confirming the current ownership of these units.
If two different instructions for converting ownership of both cryptographic units are entered simultaneously, the system selects only one.
In March 2018, the word cryptocurrency was added to the Merriam-Webster Dictionary.
Altcoin
The word altcoin has different meanings. Stephanie Yang of The Wall Street Journal referred to altcoins as "alternative digital currencies," while Paul Vigna, also from The Wall Street Journal, described altcoins as an alternative version of bitcoin. [21] Aaron Hankins of MarketWatch refers to any cryptocurrencies other than bitcoin as altcoins. [22]
Crypto token
What a blockchain account can do is not limited to payments, for example in decentralized applications or smart contracts. In this situation, units or coins are sometimes referred to as crypto tokens (or cryptotokens).
Now, we know the history of cryptocurrency. Thank you for this😊