The global economy is inescapably moving towards a digital eco-system. From money transfer to investment, everything is going paperless. The most recent and promising addition to the digital payment sector is cryptocurrency. Richard James Schueler, a master in cryptocurrency says that the big idea is that as transactions are public, irreversible, mostly unhackable, and controlled by the people, users and their digital finances are more safeguarded.
Certainly course, the use of cryptocurrency has several advantages. Below are facts about cryptocurrency and the essential reasons why you should care.
- Cryptocurrency functions on a blockchain, which is the distributed ledger. The “block” is composed of chunks of encrypted data. The “chain” is the public database in which the blocks are kept and successively related to each other. Every block in the blockchain has a particular code that differentiates itself from all other blocks. This distinctive code is known as a hash. Blocks of information being added to a blockchain are added chronologically. A new block is added after the last block ade, which also has its individual unique hash.
Now, in case someone wanted to counterfeit a single block of data on the chain. In that case, they need to maneuver all the blocks from a point in history forward and update all the computers holding copies of the blockchain ledger.
- Cryptocurrency functions same as any traditional, national currency with a few fundamental differences. Cryptocurrency does not stand for debt. It firmly represents itself, and its value is determined by what someone is eager to trade for it. The fact that cryptocurrency is decentralized plays a key role in how its currency value is determined.
- With conventional currencies issued by governments, you can transact or pay for something in person using physical cash. Metal, paper, cloth, and plastic currencies make up a small fraction of the total amount of most fiat money in circulation. Huge withdrawals of physical cash are quickly flagged and evaluated by a central authority like financial system and governments regulators.
Cryptocurrency is different. It relies on well-designed math to track the exchange between two people or companies. This occurs mostly namelessly. While the ledger or list of transactions is publicly viewable globally, the parties exchanging cryptocurrency are more private. Cryptocurrencies are held in digital wallets electronically. The owner is the holder of the private key to the wallet. The currency is exchanged from mostly anonymous wallets owned by the users digitally.
Richard James Schueler says that the objective of cryptocurrency is to eliminate all the issues that come with conventional banking. There are no limits to the money you can transfer using bitcoin, accounts are almost unfeasible to hack as you are not using a financial institution, and there is not a central point of failure.