What is Cryptocurrency And How Does it Work? – Whenever we hear the name of cryptocurrency, it is known from its name that it is a currency. But this question definitely comes in mind that what kind of currency is this. Hello Friends ! Today we will know in detail every information related to Cryptocurrency, so let’s start knowing about what is the delay.
What is Cryptocurrency
Every country in the world has its own currency. Just like America’s currency is Dollar, Kuwait’s currency is Dinar, Arab’s currency is Riyal and India has Rupee etc.
For your information, let me tell you that any currency is a currency recognized by that country. It is received in the form of money by the people working in the country. Where we work, we are given currency in return. We can buy any item using currency.
If a currency is canceled by the government, then it does not have any value. As the old 1000 and 500 notes have been canceled by the Government of India, due to which there is no value of those notes today.
The currency of any country is printed on pieces of paper and metal. We can touch this currency with our hands, as well as we can take it with us anywhere.
This is a type of Physical Currency, but when we talk about Cryptocurrency, then let me tell you that it is a type of Digital Currency, which we cannot touch. It is only in the world of Internet and all its transactions are done digitally. It is used to buy and sell anything online.
This is a type of virtual currency, it does not come under the control of the government of any country. It is completely an independent digital currency, which is used digitally.
Digital Signature is used for the verification of its transactions, all its information is saved with the help of Cryptography. It is based on Peer to Peer Electronic System, which is built on Computer Algorithm by Internet.
The name of the world’s first cryptocurrency is Bitcoin, which was proposed and developed by Satoshi Nakamoto in 2009. At present, the price of one bitcoin is 23,28,285 Indian rupees.
- Read Also – How to take loan from Bank of Baroda
What is the meaning of cryptocurrency?
Cryptocurrency is a type of Virtual or Digital Currency. Who does not have any physical form. We cannot touch it like any normal note. Because it is not printed on any kind of paper or metal. This is a currency made entirely by Computer Algorithm. All the transactions that happen here are done with the help of cryptography. It does not come under any government, bank or individual. It is a currency completely based on Blockchain Technology.
What is the meaning of cryptocurrency?
Cryptocurrency is a type of Virtual or Digital Currency, which does not have any physical form. We cannot touch it like a normal note, because it is not printed on any kind of paper or metal. This is a currency made entirely by Computer Algorithm. All the transactions that happen here are done with the help of cryptography. It does not come under any government, bank or individual. It is a currency completely based on Blockchain Technology.
How does cryptocurrency work?
Cryptocurrency runs through a computer network and is based on blockchain. The record of all the transactions that happen here is saved because it is monitored by the computer. This type of activity is called Cryptocurrency Mining. There are also many Cryptocurrency Mining Software available on the Internet, with the help of which you can also start mining.
As you know that all the transactions that happen here are saved inside the Blockchain. The complete security and encryption of this blockchain is done by the Miners, so a better Block Code is found by the Miners by solving a Cryptographic Puzzle. When a miner finds a correct and appropriate block code, it is added to the blockchain.
After this it is verified by Computer Network, this Verify Process is called Consensus. When the process of Verify is completed, Consensus becomes completely secure. After this the miner who has secured it is given some Cryptocurrency Coins. These are a kind of reward for Cryptocurrency Coins Miners. These coins are called “Proof of Work”.
How to Invest in Cryptocurrency?
Currently you can easily invest in cryptocurrency. But earlier it was not easy to invest in it. Talking about today’s time, there are many such websites and apps available on the Internet, where you can invest in it. Along with this, it is also important to know which platform is right and good. If we talk about a good app in the context of India, then WazirX App is the best among them. You can invest in any Cryptocurrency through this App.
What is cryptocurrency
Now you know that Cryptocurrency is a type of Virtual or Digital Currency. It is also known as Electronic Money. If we talk about its value, then it is counted among the most expensive currencies in the world. Although the world’s most expensive currency is the Kuwaiti dinar, any cryptocurrency is thousands of times more expensive than a dinar. Its price is never stable at one place, it keeps on going up and down. If we see the record of the last few years, then it is getting costlier day by day.
Is cryptocurrency legal?
Now there must be a question in your mind that is Cryptocurrency Legal? So for your information, let us tell you that the answer to this question varies from country to country because it is legal in many countries and not in many countries.
If we talk about India, then Cryptocurrency is Legal here. You can buy and sell it in India because the Government of India has not yet banned it. Although some time ago the news of banning it came to light in India, but the Supreme Court of India has lifted the ban imposed by the Reserve Bank of India. It is possible that in the coming time, the Government of India will issue a law regarding cryptocurrency.
- Read More – How to get a credit card from Bank of Baroda
History of Cryptocurrencies
Like the history of everything, Cryptocurrency also has its own interesting history. The first cryptographic was started in 1983 by David Chaum of America. He conceived the concept of an unknown cryptographic electronic money, which was launched in 1995 through Digicash.
Cryptographic is an early form of electronic transaction. In 1996, the National Security Agency described the cryptography of encrypted electronic cash in the How to Make to Mint paper. Earlier it was also published in MIT Mailing List. After this it was also published in American Law Review in 1997.
The world’s first cryptocurrency was launched by Satoshi Nakamoto, whose name was Bitcoin. Although there are many doubts about the name Satoshi Nakamoto that it is not the name of a person, but the name of an organization.
If we try to know about the founder of Bitcoin on Wikipedia as well. So there also no real picture of Satoshi Nakamoto exists, only a picture of a statue is attached. Initially cryptocurrency was used in the Dark Web, it is still used in the Dark Web, but it has become popular from there.
Only 3 months after the launch of Bitcoin, its Transactions in the Dark Web had reached about 1.2 Million. This is because no one gets to know anything about the transaction here. Here the identity of every user is hidden. This is its biggest feature.
Types of cryptocurrencies
If we talk about cryptocurrency, then the name of Bitcoin comes first. But apart from this there are other Cryptocurrencies as well. Today we will know in detail about all the Cryptocurrencies here. Let us know the complete information about Top Cryptocurrency List –
1. Bitcoin (BTC)
Bitcoin was started in 2009 by Satoshi Nakamoto. It was the world’s first cryptocurrency, which achieved the most success. Even before this many Digital Currency were made, but none of them became popular like this. Its highest price in India has gone up to Rs.44,54,673. Although its price keeps on rising and falling.
2. Ethereum (ETH)
Ethereum was launched in 2015 AD. It is the second largest cryptocurrency in the world. Ethereum acts as a kind of Decentralized Open-Source Blockchain. It is also known as Ether and it is the world’s most actively used blockchain network.
3. Tether (USDT)
Tether was launched in July 2014. Initially its name was Realcoin but later it was named Tether. It is a stable cryptocurrency, its value is always equal to one dollar. It is hosted on the Ethereum and Bitcoin blockchains. Tokens of this cryptocurrency are issued by Tether Limited, a Hong Kong based company.
4. Polygon (MATIC)
Polygon was first created in 2017 by Sandeep Nailwal, Anurag Arjun, Jayanthi Kanani and Mihailo Bjelic. It is a framework to connect Blockchain Network with Protocol and Framework.
5. Cosmos (ATOM)
Cosmos helps in connecting the blockchain network with each other and communication and data sharing between them. It is also known as Network of Blockchain. In this, Tools and Products are used for Communication, Transaction and Data Sharing.
6. Monero (XMR)
Monero is a popular cryptocurrency, which was released in 2014. It is mostly used in Dark Web because it is known for its Security Fetures. It is also mostly used for illegal activities.
7. NameCoin (NMC)
NameCoin is a type of cryptocurrency, it has been linked to Bitcoin. It is completely a currency based on bitcoin, which uses Proof of Work Algorithm.
In fact, the Proof-of-Work (POW) proposal was issued to keep cryptocurrencies safe. The way bitcoin is limited to 21 million coins, similarly it is also limited to 21 million coins.
It can store data in its own Blockchian Transaction Database. Its special thing is that its Censorship-Resistant Domain Name, which is .bit.
This is a Top Level Domain like .net and .com Domain. Despite this, ICANN (Internet Corporation for Assigned Names and Numbers) does not have any kind of control over this domain.
8. Litecoin (LTC)
- Litecoin was launched in October 2011. This MIT/X11 is a Peer-to-Peer cryptocurrency and is a type of Open Source Project. This cryptocurrency is almost similar to bitcoin.
9. BitTorrent (BTT)
- BitTorrent was created by the Tron Foundation. BitTorrent cryptocurrency is mainly based on Peer-to-peer File Sharing Protocol. The main purpose of this currency is to facilitate file transfer between Untrusting Process Participants. This is also based on Blockchain Technology.
10. Peercoin (PPC)
Peercoin was launched in August 2012. This is a type of Proof-of-Stake Based Cryptocurrency. Apart from this, it also uses Peer-To-Peer and Proof of Work System.
Proof-of-Stake system provides new coins to the Holding Person in a way. Which means that 1% of the block of all Proof-of-Stake will be given to the Share Holder, with the help of which the currency can be made expensive.
Advantages of cryptocurrency
The use of cryptocurrency is very popular these days. Many people are investing in it, so let’s know about the benefits of Cryptocurrency –
- It is completely secure because it acts as a digital currency in a way. No one can do any kind of fraud here.
- In this you get many Digital Wallets, with the help of which you can easily invest here.
- Buying and selling cryptocurrency is very easy, you can buy and sell it anytime.
- For this you do not need any kind of bank.
- The most important thing is that it is not under the control of any state or government.
- If you invest your money here then you can get good profit. Although it completely depends on the market, but its price has been increasing continuously for many years.
Disadvantages of Cryptocurrency
- The biggest loss in cryptocurrency can be to the investor. Because no authority has control over it. Because of which no one knows when its price will decrease and when it will increase. However, according to the reports of many years back, its price has not fallen down yet, but is continuously increasing.
- This is a type of digital currency, so there are frequent hack attacks here. Although it has been completely secured, such an incident has happened once with Ethereum.
- Cryptocurrency is completely virtual currency, it does not have any coin or note that you can touch.
- It is mostly used for Illegal Activities. It is used to buy stolen Credit/Debit Cards, Drugs etc.
Our dear readers!
How did you all like the information about Cryptocurrency? You must share your thoughts with us in the Comment Box. Hope you all must have liked this article, then do share it with your friends.
Questions related to cryptocurrency –
What is the cryptocurrency of India?
India does not have any cryptocurrency of its own.
How to buy cryptocurrency?
You can easily buy cryptocurrency from WazirX, CoinDCX.