Homework Task 5

Subject: What Is Cryptocurrency and How You Would Like To See Cryptocurrency In The Future?

HOMEWORK

Preliminary Information

Cryptocurrencies are one of the most popular agenda items in recent years. Cryptocurrencies started to enter our lives gradually, with Satoski Nakamoto's first bitcoin mining in 2009. Since then, all cryptocurrencies, especially Bitcoin, have become very important and have created their own markets around the world.

Now there is almost no one in the world who does not know the word cryptocurrency, and many people make money thanks to cryptocurrencies. Of course, although everyone knows, there are many people who stay away from cryptocurrencies and only know their name.

After this brief information, I would like to give one last piece of information and move on to the homework; What is cryptology? One of the first things to know when talking about cryptocurrencies is what cryptology is. Cryptology is a kind of encryption unit. The process of encrypting the data according to a certain system, sending it to the receiver in a secure environment and decrypting this encryption system is called cryptography.

What Is Cryptocurrency?

Cryptocurrency is a digital and virtual currency that uses cryptology for security, and this currency is encrypted based on mathematics. Cryptocurrency is an intangible and non-physical virtual currency. Cryptocurrencies are usually found on decentralized blockchain platforms. Cryptocurrencies are digital currencies and internet is needed to manage these currencies. Cryptocurrencies exist virtually wherever there is internet and a device that can connect to the internet.

There is no need for a third-party company, such as a bank to use a cryptocurrency. Also, since there is no need for such a company, it is not necessary to provide identity information when using cryptocurrencies. Anyone who has the internet and a device that can connect to the internet can transfer money to anywhere in the world at low fees. Cryptocurrency is safer to use, as no credentials are needed, and only you know how many cryptocurrencies you have. No government, no company or anyone can know this without your permission.

Cryptocurrency wallets are protected with high security thanks to keys with mixed letters and numbers. However, if these keys are lost, it is irreversible and all your cryptocurrency assets are lost because cryptocurrency uses blockchain, which is a decentralized system. In other words, you will not be able to find an authorized person who can solve your problem. In order to prevent this, it is necessary to save the private keys on a piece of paper and keep them safely.

How cryptocurrencies emerged is more or less known. A group or a person named Satoshi Nakamoto produced a blockchain technology for the first time and made Bitcoin mining in 2009, enabling us to meet cryptocurrencies. The purpose of cryptocurrencies is to transfer money faster and with lower fees in a free environment without the need for banks. Of course, blockchain technology, which is this free environment, is now gradually being used in other areas.

Cryptocurrencies are not tied to any central authority or government. The production of cryptocurrencies also depends on their users. Every cryptocurrency has a certain production limit and it is not possible to exceed this limit. However, this limit can be lowered and the volume of cryptocurrencies in the market can be reduced from time to time with the burning process. For example, the production limit of bitcoin according to the first published protocols is 21 million. We are getting closer to this limit every day, and for this reason, mining of bitcoin is getting harder every day, the demand is increasing and its value is increasing.

The production process of cryptocurrencies is done in the form of mining. Just as you need to dig somewhere to find gold, you have to dig somewhere to find crypto money. But the digging here is not done with picks and shovels, but by solving mathematical problems. There are special software for mining and anyone can mine. Since anyone can mine, the person who mines the most earns the most crypto money.

E.g; I am mining RVN (Ravencoin) from my own computer. My daily earning is about 11 RVN. But someone with a more powerful computer than mine can earn more than me because they can dig more. This shows that the more you dig, the more profit will be made.

On the other hand, states may perceive cryptocurrencies as a threat because the source of the money is not clear. This money can be used very easily for tax evasion, money laundering and illegal activities. Cryptocurrencies are kept in virtual wallets and cannot be detected because these virtual wallets are located on thousands of devices on the blockchain. Therefore, states cannot seize or manage that money.

Finally, thanks to cryptocurrencies and blockchain technology, users can benefit from a cheaper transfer fee and a faster system. Due to the cheaper transfer fees, most people in the world now transfer with cryptocurrencies. For this reason, the profit rates of banks are gradually decreasing. Due to this decline, banks are putting pressure on governments to ban cryptocurrencies.

How You Would Like To See Cryptocurrency In The Future?

While answering this question, I would like to start with a topic that I mentioned a little bit in the previous question. In terms of security, cryptocurrency is much more reliable and can only be managed by its owner. That's why I want a system where we can shop using qr code in all businesses in the world as quickly as possible. In fact, there are places to shop in this way, but unfortunately not everywhere. For example, there is no such business anywhere in the city where I live. We pay too much commission on credit and debit cards unnecessarily. The system that will minimize these commissions is exactly blockchain-based cryptocurrency.

Using cryptocurrency in schools, libraries, hospitals, government offices and all the rest will really make our lives so much easier. Since Cryptocurrencies is a decentralized system, no one can steal our money as long as we keep our keys safely. Also, people learn better to manage their own money.

On the other hand, paper money is constantly getting old and needs to be replaced with new ones, or states spend resources printing new coins. Cryptocurrencies, on the other hand, function the same as paper money, without the need to spend these resources. Yes, electrical energy needs to be used while mining these coins. But I feel comfortable as I think that we will get this energy from completely renewable sources (wind panels, solar energy, dams, etc.) in the future.

Yesterday's technology was banks and paper money, today's technology is internet banking and paper money, tomorrow's technology will be blockchain and cryprocurrency. It must be. Because thanks to cryptocurrency, it is no longer banks, but the public, thanks to low transaction fees and fast transfer. Why should money transfer take hours? Why are transfer fees so expensive? I think the exchange and interaction between people will increase when these transfer fees are less. Thanks to the acceleration in the transfer process, I think people will save more time.

We are now in the space age. Anyone who does not keep up with this age will turn into fossils over time. There will come a time when people who do not use cryptocurrency will be out of life. This may seem like a bad thing, but we should think about it this way. There are still people in the world who have not met technology and do not know how to use it. Nothing like this will happen when cryptocurrency is used everywhere in the world. These people will have to learn that somehow. Willingly or unwillingly, it doesn't matter. Somehow they will learn this and they will have to keep up with the times. And in this way, the human race will develop a little more and even the most ignorant person will have a certain level of knowledge.

Conclusion

As a result;

• Cryptocurrency is a decentralized system that will save people from banks and large corporations.
• Thanks to blockchain technology, the use of cryptocurrency is much more reliable and beneficial.
• Thanks to cryptocurrency, people learn better how to manage their own money.
• Cryptocurrency greatly benefits people's lives thanks to its transfer speed and low transfer fee.
• With the use of cryptocurrency instead of money, energy waste is eliminated thanks to renewable energies.
• Even the most uninformed people are better adapted to the era by having a certain level of knowledge thanks to cryptocurrency.

CC: @sapwood

by @theoxl