Cryptocurrency: The concept
Cryptocurrency, the simple terms, known and defined as an asset which gets monitored by cryptography. This algorithm itself works like a software that had been used in severals cryptocurrency trading.
Although The Bitcoin is an asset, it’s location is mostly outside the physical.
Taking a closer look at it, cryptocurrency is such currency that defies the initial law of currency. It isn’t physical and doesn’t come from one source of production. Despite its lack of physical presence, a lot of people have used it to make a lot of business transaction.
Many people have wondered how it came to be because there was nothing like algo-coin or virtual-coin before the year 2000 and for this reason, a lot of people have resorted to reading cryptocurrency books or taking cryptocurrency courses.
Well, here, you will be greatly exposed to mind-blowing information about this concept and you will find cryptocurrency explained in such a simpler term than any other place.
A Brief History of Cryptocurrency
As people began to grow tired of the system that surrounds the spending and trading of regular money, they began to seek out new methods of having their trades without following undue protocols. A man by the name Satoshi Nakamoto took it on himself to build something called Bitcoin.
When creating this Bitcoin, the only thing on his mind was to fashion a method that will make it easy to make transactions between peers. In other words, people do not need a bank before they dispense their money. In better term, there would be no need for anyone to monitor your transactions. Rather, no one will have the chance to monitor transactions.
When he created this coin, he never expected the massive success that followed it. Thus, bitcoin became the first and most important Crypto Currency available.
From the above statement, you can easily deduce that there are cryptocurrencies that are not Bitcoin. With time people began to create more cryptocurrencies like Etherium, Litecoin etc.
And that sparks a need to know how it really works.
How Does Cryptocurrency Work?
As stated earlier, cryptocurrencies are such that are monitored by the software, cryptography. This software is like the bank of the currencies. Now, take a step back. You have read earlier that there is no central bank. So, that arouse some questions in your mind.
Look at it in this light, cryptography is like the marketplace for any cryptocurrency market. It doesn’t monitor your transaction. It is like a bouncer at a party. Its work is simply to make sure you have your pass while making transactions with anyone within its market.
Cryptography provides you with a public and a private key. These keys are what referred to as encryption and decryption. The purposes of the keys are to help you send a message privately to someone you know or wish to make any sort of transaction with.
One of the keys, the public key is to make the person sending the message to you send a particular transaction to you. It is his own pass to you. If you don’t provide it, the transaction can’t happen. The private key is like your personal password. Its job is to help you decipher the transaction.
As brief as it may look, you must have garnered a lot of information from this post and will surely use that to pad your knowledge of cryptocurrency.