Simplifying Cryptocurrency for Friends and Family

Cryptocurrency – The Simple Definition

Technology has changed the concepts that we have been basing our lives on for several hundred decades. The concept of currency has been followed since ancient times, when the currency was nothing but gold. The basic concept remains the same which is based on the ideology of exchange, which is pretty simple, you pay in the shape of money in exchange for goods or services.

Moving ahead, paper currency or the currency that we rely on these days has a value and this value has been devised by the government, for instance, a $10 bill has a value of 10 dollars, a single dollar has a value of 100 cents and then each cent has a value of 10 pennies, so on and so forth.

What is Cryptocurrency?

The basic idea behind cryptocurrency is that of the conventional currency and the concept of exchange stands true in this case as well, however one can call cryptocurrency as the modern currency. The difference between cryptocurrency and normal currency is that cryptocurrency is not regulated by the government, which in-turn means that the value is not determined by any authority which makes it a decentralized currency. For this reason, all kinds of cryptocurrency are determined to be illegal and is seen as a threat to the financial situation of the world.

Another difference between the normal currency and cryptocurrency is the fact that is holds no physical existence, it is an electronic source of currency which can be traded online. As long as the security is concerned, cryptography is used to make sure that all transactions are secure. Another factor that goes in favor of cryptocurrency is that is irreversible, fast and have a minimum to no fees, it is universal so you don’t have to worry about the transition in value as you make a global payment over the internet. The supply of the currency is done with the aid of a software which cannot be manipulated by any government, bank, organization or individual.

What is Bitcoin?

Bitcoin is most widely recognized and known form of Bitcoin. Majority of people tend to confuse Bitcoin with crypto-currency, however, in reality Bitcoin is a kind of crypto-currency. Bitcoin, is a type of cryptocurrency, just like dollar or pound is a currency. Unlike dollar, Bitcoin is global and each transaction is hashed with a timestamp that cannot be changed until and unless the proof-of-work is redone.

The value of the Bitcoin has been on the rise since 2013 and it has reached its highest peak in 2017 which is over $3000 per Bitcoin. It has been expected that the value will rise even more as people turn towards making more transactions on the internet.

What is Block Chain?

The Block Chain is a database or a wallet that keeps a record of all the ordered records which are known as blocks. Think of it this way, a block chain is as if a bank had a list of all the account holders and the list is updated every time a person makes a payment or is being paid. The list is kept updated and all the transactions are stored against a timestamp, this also acts as a ledger for keeping an open record of the transactions between two individuals or parties.

This is my first time posting! I hope you enjoyed it!