Posted on January 15, 2019 5:00 PM
With an extensive career behind me and belonging to the older generation who are still coming to grips with technology, I am a complete beginner to Cryptocurrency and the online world in general.
The following is what i have found over the course of my research. Hopefully this helps people new to this topic to get a basic idea of what Crypto is, how it works and the challenges it faces.
Crypto Technology has been developed during the last decade facilitating invention of Cryptocurrency. Cryptocurrency is Digital/Virtual Currency. The need for Cryptocurrency arose to fix a number of procedural flaws with the way the money is transacted from one party to another. Bitcoin(BTC) was ,therefore, conceived in 2008 to tide over certain flaws.
Cryptocurrency transactions are peer to peer by electronic means. Cryptotechnology is the infrastructure that underlies Virtual Coins so it is the foundation while the Virtual Coins represent the Product built on top of the Foundation.
Major Cryptocurrencies to name a few are; Bitcoin(BTC), Ethereum(ETH), Ripplle(XRP), Bitcoin Cash, DASH, Z Cash(ZEC), Litecon, Monero(XMR), NEO, EOS and Cardano (ADA).
There are 1600 plus Cryptocurrencies and their number is always changing. If a person has time, money and a team of people who understand how to write a computer code, they could develop their own Cryptocurrency.
Advantages of Cryptocurrency over Conventional/ Fiat Currency
Banks normally take time to settle transactions especially for Trans-border transactions. Fee is charged by Financial Institutions acting as Third Party Middlemen during transactions. Using Cryptocurrency people can send money from anywhere to anywhere else directly, bypassing the bank fees, wire fees etc. This is a big advantage of Cryptocurrencies.
Cryptocurrencies work around Traditional Financial System through use of Block Chain Technology(BCT). BCT makes use of Block Chain where all the transactions of Virtual Currencies are stored. Buying/Selling Cryptocurrencies or items is recorded in Digital Ledger stored on Hard Drives and Servers all over Globe. As such, no single person/Company has control over the transactions. The Technology acts as safeguard against Cyber Attacks. Overall results are faster settlement of transactions with comparative lower fee with ongoing verification of transactions.
Cryptocurrencies can be traded through Crypto Exchanges like MoonTrade.org. These are platforms through which one can purchase or sell Digital Currency for Dollars/Euros/ Pounds as well as other Digital Assets. These Exchanges are vital part of Virtual Currency expansion rate. The Exchanges are private and require some sort of identity. The more complex is the verification process the safer is Exchange Platform.
In Part II of this series on “What Is Cryptocurrency”, we will deal with the advantages and disadvantages of Cryptocurrency.
Hopefully, this short introduction helps people who are coming from older generations or from less-technical backgrounds understand the concept of this revolutionary new way of sending and receiving money.