Many proven facts about cryptocurrencies are relatively obscure. Partly, due to how new these assets are, and partially, because the technology behind them is confusing to those that are not technically inclined. So, let’s take a minute to explore some common facts about cryptocurrency.
Satoshi Nakamoto founded Bitcoin
The founder(s) of Bitcoin, the most popular cryptocurrency, is still a mysterious figure. Nobody knows who Satoshi Nakamoto really is, or where he, she or they have gone. The Bitcoin project was ghosted some time ago, then handed over to other trusted developers, to continue Bitcoin’s mission of becoming a digital currency that offers freedom to its users.
The main attraction to cryptocurrencies for most users is decentralization. A large number of cryptocurrencies are not controlled by any central authority, making them less susceptible to manipulation. This has helped create a democratic system of majority carries the day. Even though this makes governments and centralized authorities like banks nervous, there is nothing to fear as their concerns stems from their lack of control. In a world where everything is an intellectual property, trademarked or copyrighted, open source technology seems baffling. However, it offers some distinct advantages. Developers will come and go, but since blockchains are open source, anyone is free to develop them.
Unlike companies, cryptocurrencies cannot be shut down, in a worst-case scenario they could simply fork to a new code. This is partly why one of the core fundamentals of most cryptocurrencies is maintaining decentralization. It keeps everyone on a level playing field, and it ensures that no single entity can control the state of the network. If they could, then cryptocurrencies would become worthless and users will doubt the security of the ecosystem.
Transparency is a big part of the fundamentals of cryptocurrencies. The blockchain ledger helps keep its network accountable for every transaction. Due to the transparent nature of the blockchain – the technology behind cryptocurrencies – governments, and other mainstream institutions, are now exploring ways they can use the application to enhance productivity. Every transaction on the blockchain is public and can be seen and tracked by the global community.
An important question often asked is how cryptocurrencies can be transparent and at the same time offer its users privacy. The blockchain provides some degree of privacy to users. Identities of users are hidden using encryption and cryptography, and it is very difficult associating users with public addresses.