Blockchain and Cryptocurrency

💰 Blockchain and Cryptocurrency💰

Over the past few years, cryptocurrencies-and in particular, Bitcoin-have has proven their value, with 14 million Bitcoins now in circulation. Most of the current market capitalization has been driven by investors speculating on future possibilities of this technology, and that will likely continue until a certain measure of price stability and market acceptance has been achieved. As well as disrupting the traditional payments system, the blockchain public ledger technology (underlying cryptocurrency) is capable of disrupting a wide variety of transactions. In addition to stocks and bonds, there are other financial assets whose records are currently stored digitally and for which third parties must verify the transaction.

 But What is Blockchain Technology?

Blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system.

A blockchain is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain. Each block in the chain contains a number of transactions, and every time a new transaction occurs on the blockchain, a record of that transaction is added to every participant’s ledger. The decentralized database managed by multiple participants is known as Distributed Ledger Technology (DLT).

 

What are cryptocurrencies and why do they use blockchain?

Attempts to create digital money have been made before, but they have always failed.

 

This is primarily a trust issue. When someone creates a new currency called the X dollar, how can we trust that it won"t be used to give themselves a million X dollars, or stolen from you?

 

With the help of blockchain, Bitcoin was designed to solve this problem. It is common for databases such as SQL databases to have a person responsible for changing the entries (e.g. giving themselves a million dollars). The difference between blockchain and other technologies is that nobody controls it; it is run by its users. In addition, bitcoins are impossible to fake, hack, or double-spend - so anyone that owns them can feel confident that they have value.

 

Today it is not only bitcoin that uses blockchain technology but there are other cryptocurrencies like Ethereum that are using this technology and their value entirely depends on their holders and market. But how we can use cryptocurrencies? Where to keep them and how to spend them? The answer is crypto wallets.