Do you know what actually is cryptocurrency? Yes, of course, it is a digital currency. The word cryptocurrency has arrived from the combination of words cryptography and currency. What is cryptography?
Does Cryptocurrency Have A Bright Future Or Fad?
The advanced encryption technology used to create and manage the digital currency is known as cryptography. Is the future of cryptocurrency bright or fad? let’s discuss this in this article.
Cryptocurrency is a decentralized network of currency that uses peer-to-peer technology. This technology helps to enable all functions such as currency issuance, transaction processing, and verification to be carried out collectively by the network. A blockchain is a form of the electronic ledger that offers full transparency and security for cryptocurrencies. Actually, cryptocurrency is implemented by using blockchain technology. The decentralization of these digital assets makes it free from government manipulation or interference. Mainly the crypto coins are generated digitally through a process known as mining. Mining is a digital process that requires powerful computers to solve complex algorithms. The factors that increase the importance of cryptocurrency are:
- Cryptocurrencies are decentralized currencies. They are completely out of control of the government. So it is more reliable too.
- The coins cannot be devalued through any dictatorship
- It is more secure than fiat currencies
- Under the system of cryptocurrency, you are the owner of your assets. There will a public key and private key to prove your identity.
Bitcoin and altcoins
Bitcoin is known as the king of cryptocurrency. All other coins other than Bitcoin are known as altcoins. Bitcoin is a cryptocurrency or virtual currency developed in 2009. It is a medium of exchange, created and stored electronically using blockchain technology. The Blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record financial transactions. This technology makes it possible to trace the history of Bitcoin transactions.
The value of Bitcoin has gone up and down over the years since it was created in 2009. It is the most popular among cryptocurrencies. Like traditional currencies, bitcoin is not issued by a central bank. So the monetary policies, inflation rates, economic growth, and other financial issues do not affect the value of bitcoin. It is commonly referred to as virtual currency and is a computer file that is stored in a digital wallet. Altcoins differ from Bitcoin in a range of ways. They employ different proof-of-work mining algorithms and coin distribution method. Yet some of them offer more privacy compared to Bitcoin. But most of the Altcoins offer no benefits over Bitcoins and they have less hash power securing them.
The question is what will be the future of cryptocurrency, will it be bright or fad? Cryptocurrency has some demerits now, such as the asset can be completely erased through a computer crash and vulnerability towards hackings. Maybe in the future, digital assets may overcome these demerits with the help of advanced technologies. Now many merchants are accepting and using crypto for purchasing and selling goods. That is, people began to accept cryptocurrencies as like or more than fiat currencies. These all are some positive signs of a bright future of crypto coins. Always hope for the best and may it does not have a ruined future.