I am sure you have come across the trending term - Bitcoin or cryptocurrency. If not, here's the article that you must read as it will help you to connect with the digital world. Besides, by the end of the article, you will understand the reason behind the heated argument between tech-savvies and politicians. So, let's get started.
Currently, in our financial system we have - Fiat money and the third party controlling i.e. financial institutions and government institutions. Nothing wrong with it, they have our money and they handle it and manage the liquidity. Our complete biodata is with these institutions and there are a set of objections to using our own money.
The concept of cryptocurrency can be considered a modern solution to modern problems. The currency only exists on computers and is decentralized as they don’t have a main server or computer. There’s no involvement of the third party and the special code is difficult to hack too. Moreover, there are no restrictions to use cryptocurrencies. As each country has its currency (Fiat currency), it becomes difficult to transfer it all over the world. In the case of cryptocurrencies, you can transfer it in any corner of the world.
When understanding cryptocurrency, one cannot miss having a glance at Bitcoin.
In 2009, a mysterious individual or group created Bitcoins under the name of Satoshi Nakamoto. Well, no one knows the whereabouts of Satoshi Nakamoto.
The common idea of Nakamoto is a peer-to-peer transaction platform where two parties directly interact with each other, make the transaction and no third party is involved and no identity is revealed.
To contrast more -Bitcoin is easily divisible and portable, its globally accepted. You as a resident of India can send money easily to New York without revealing identity, transaction, and storage of bitcoins doesn't need highly authorized third parties either the expense they demand.
In bitcoin, either you get a fortune or you get at square one because bitcoins are very volatile.
Bitcoin is ALMOST the same as the traditional currency.
Unit of account
The smallest unit of Bitcoin is hundredth of millionth Bitcoin, which is also known as Satoshi. Possibilities are there can be more subdivision of Satoshi.
Exchange and asset
Bitcoin is more scarce than gold. You can sell your bitcoin and convert it to any other fiat currency. It’s more liquid than something like property and gold.
Obviously, not everyone accepts Bitcoin but you can use bitcoin on major retailers like Expedia and Newegg, and even Overstock.
Blockchain and mining
There's an electronic ledger out there made by various complicated mathematics and algorithm solving. When you buy a bitcoin you own a slot in that electronic ledger and every time you make a transaction your previous entries of the transaction are evaluated and checked in that blockchain to check the legitimacy.
So, there are several copies of electronic ledger which is constantly evaluated and new transactions are added to them, which is done by mining. The purpose is to avoid false transactions.
In other words, mining is the process of verifying and updating the internet-wide distributed ledger.
Miners produce a new block on the blockchain by verifying and recording the new transaction. So, the bitcoin blockchain is always working on progress, unless transactions with bitcoin stop.
Platforms to make transaction and Storage of Bitcoins
So, many businesses hesitate to accept Bitcoins as money, but even then, there are a few businesses like Coingate, Bit panda, and coinbase, allowing the individual to store and perform a transaction and even convert them to the authorized currency.
Besides, it's quite simple to get started with such online platforms. You just have to get a bitcoin wallet to install, create invoice with authentication method depending on which wallet you install, confirm payment details through authentication method (example barcode), and proceed with the transaction.
For buying a bitcoin, you can download tools like coinbase and bitpanda. To store them further, you can use wallets. Wallets – as the name suggests is a platform to store your bitcoin. It can be online or offline, but of course, the transaction can be performed online only.
The main thing in handling your wallet is that you're responsible for your currency as it’s not supported by any authorized institutions and there's no one you can go to at the time of crisis-like situations. And, of course, don't miss out the fact that even if the transactions are secured, Bitcoins are prone to hackers.
So, bitcoin where provides efficiency and security, also it is open to hackers when it comes to storage of Bitcoins and you will be solely responsible for it.
I’m sure, if you’re here, then you have understood Bitcoin overall. As it was presented in 2009 by Satoshi Nakamoto, developers figured the underlying blockchain technology in bitcoin and by 2016, we had more than 26,000 projects based on blockchain. However, only 8% of these projects are surviving.
Hope you don't get confused here between blockchain and Bitcoin - bitcoin is a cryptocurrency which is based on blockchain technology.
What is blockchain?
When you share a digital data to some other person, then all transaction-related information (encrypts) get stored in a block, but to complete a transaction, this information should be verified which is done by miners. They (miners) solve complex algorithms which verify the transaction and forms new block, this process is called mining. For their work, the miners are rewarded by the system. This whole mining process makes manipulation of any transaction impossible because all the blocks are connected. So, if you want to manipulate information from a certain block, you will have to undo all the blocks formed after that particular block, which is not possible.
Blockchain technology also prevents the problem of double-spending. Let's say, you have a bitcoin which is a digital data, so it's easy to duplicate it and use it on two different transactions. Miners verify each transaction and put a timestamp on a block. So, when you use a duplicate copy, the system identifies it and eliminates that transaction.
“The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”
– Don & Alex Tapscott, authors of Blockchain Revolution (2016)
‘Transaction’ here is not limited to cryptocurrency. It can be an exchange of currency, exchange of information and of contracts which can have conditions to fulfill (smart contracts). All together makes ‘virtually everything of value’.
Blockchain is a digital ledger which is present on multiple nodes (computer) connected with the network. And the data is updated on all the nodes, whenever a transaction takes place. Therefore, there is a transparency in the network. And there is no central authority for the blockchain to operate. So, the blockchain system can not be hacked or manipulated by anyone.
Besides that, you don't need to share your personal information with any central authority to use its services, this means your information can't be leaked, manipulated or destroyed by anyone.
“As revolutionary as it sounds, Blockchain truly is a mechanism to bring everyone to the highest degree of accountability. No more missed transactions, human or machine errors, or even an exchange that was not done with the consent of the parties involved. Above anything else, the most critical area where Blockchain helps is to guarantee the validity of a transaction by recording it not only on the main register but a connected distributed system of registers, all of which are connected through a secure validation mechanism.”
– Ian Khan, TEDx Speaker | Author | Technology Futurist
As mentioned above, any service which is developed using the blockchain technology will be in a decentralized form. So, there won't be any intermediary demanding you charges and your personal information.
Blockchain can change the WORLD!
Finance system
Cryptocurrency as a store of value is the hottest investment already and its globally accepted, so you escape all the hassle of obligations to handle your money on global aspects. What’s more? It's safer and trusted because it doesn't have central authorities and you can control your money as you want. So it's a quite obvious industry which will get disrupted.
Contracts and agreements
Contracts bond a personal by written or verbal form stating an agreement. It's a lengthy process to clarify contracts and its build upon trust. Smart contracts can set an exchange of assets when certain obligations are fulfilled, so you don't have to trust anyone as the technology is fulfilling your task. For example, smart contracts can use it to set insurance.
Voting and identification
In blockchain-based identification, we only need to have the key to unlock our whole information. Moreover, it can collect our information from all over the internet and present it in a single space. Finland is using blockchain for identification of voters. Even the Russian government is going to use the blockchain in the upcoming presidential election for the vote count.
Government
Just imagine all the government data will be decentralized and more transparent which bureaucracy might hate. Blockchain can help people to utilize the beneficiary provided by the government without any intermediary so delays and bureaucracy can be avoided as well.
Cloud storage
Wouldn't it be nice to get free online data storage and earn some value as well?
The space unused in your device can be used for storage for another person in exchange for crypto coins.
Filezilla, sia, storj, and maidsafe are a few well-known distributed cloud storage platform.
Social networking sites
Steemit is one of the first social platforms based on blockchain technology. This system rewards content creators. We have sola.ai which is combining social media with Al. Sapien.network is highly customizable and indorse.io is a platform to showcase your career profile and connect with people for a job opportunity, the list goes on. Furthermore, they are more advanced than a mainstream social platform but like any other technology, it will take time to evolve.
Blockchain is an innovation which is giving a platform for more innovation. It's very obvious that blockchain is still at an initial stage and like other growing technology, it's not going back. Countless new applications will be created. So, the above list is very limited and maybe, it's not too early to say that blockchain can take place in any type of industry, including data management and record-keeping.
“The ‘blockchain’ technology behind bitcoin could prove to be an ingredient of an entire new world of technology, as big as the internet itself, a wave of innovation that drives the middleman out of much commerce and leaves us much more free to exchange goods and services with people all over the world without going through corporate intermediaries. It could radically decentralize society itself, getting rid of the need for banks, governments, even companies, and politicians.”
– Matt Ridley, The Evolution of Everything: How New Ideas Emerge
Now that you know about the digital currency, cryptocurrency is no more a piece of Greek and Latin for you. So, it’s time for you to join the debate revolving around cryptocurrency and confidently take your stance on the same.
Currently, in our financial system we have - Fiat money and the third party controlling i.e. financial institutions and government institutions. Nothing wrong with it, they have our money and they handle it and manage the liquidity. Our complete biodata is with these institutions and there are a set of objections to using our own money.
The concept of cryptocurrency can be considered a modern solution to modern problems. The currency only exists on computers and is decentralized as they don’t have a main server or computer. There’s no involvement of the third party and the special code is difficult to hack too. Moreover, there are no restrictions to use cryptocurrencies. As each country has its currency (Fiat currency), it becomes difficult to transfer it all over the world. In the case of cryptocurrencies, you can transfer it in any corner of the world.
When understanding cryptocurrency, one cannot miss having a glance at Bitcoin.
In 2009, a mysterious individual or group created Bitcoins under the name of Satoshi Nakamoto. Well, no one knows the whereabouts of Satoshi Nakamoto.
The common idea of Nakamoto is a peer-to-peer transaction platform where two parties directly interact with each other, make the transaction and no third party is involved and no identity is revealed.
To contrast more -Bitcoin is easily divisible and portable, its globally accepted. You as a resident of India can send money easily to New York without revealing identity, transaction, and storage of bitcoins doesn't need highly authorized third parties either the expense they demand.
In bitcoin, either you get a fortune or you get at square one because bitcoins are very volatile.
Bitcoin is ALMOST the same as the traditional currency.
Unit of account
The smallest unit of Bitcoin is hundredth of millionth Bitcoin, which is also known as Satoshi. Possibilities are there can be more subdivision of Satoshi.
Exchange and asset
Bitcoin is more scarce than gold. You can sell your bitcoin and convert it to any other fiat currency. It’s more liquid than something like property and gold.
Obviously, not everyone accepts Bitcoin but you can use bitcoin on major retailers like Expedia and Newegg, and even Overstock.
Blockchain and mining
There's an electronic ledger out there made by various complicated mathematics and algorithm solving. When you buy a bitcoin you own a slot in that electronic ledger and every time you make a transaction your previous entries of the transaction are evaluated and checked in that blockchain to check the legitimacy.
So, there are several copies of electronic ledger which is constantly evaluated and new transactions are added to them, which is done by mining. The purpose is to avoid false transactions.
In other words, mining is the process of verifying and updating the internet-wide distributed ledger.
Miners produce a new block on the blockchain by verifying and recording the new transaction. So, the bitcoin blockchain is always working on progress, unless transactions with bitcoin stop.
Platforms to make transaction and Storage of Bitcoins
So, many businesses hesitate to accept Bitcoins as money, but even then, there are a few businesses like Coingate, Bit panda, and coinbase, allowing the individual to store and perform a transaction and even convert them to the authorized currency.
Besides, it's quite simple to get started with such online platforms. You just have to get a bitcoin wallet to install, create invoice with authentication method depending on which wallet you install, confirm payment details through authentication method (example barcode), and proceed with the transaction.
For buying a bitcoin, you can download tools like coinbase and bitpanda. To store them further, you can use wallets. Wallets – as the name suggests is a platform to store your bitcoin. It can be online or offline, but of course, the transaction can be performed online only.
The main thing in handling your wallet is that you're responsible for your currency as it’s not supported by any authorized institutions and there's no one you can go to at the time of crisis-like situations. And, of course, don't miss out the fact that even if the transactions are secured, Bitcoins are prone to hackers.
So, bitcoin where provides efficiency and security, also it is open to hackers when it comes to storage of Bitcoins and you will be solely responsible for it.
I’m sure, if you’re here, then you have understood Bitcoin overall. As it was presented in 2009 by Satoshi Nakamoto, developers figured the underlying blockchain technology in bitcoin and by 2016, we had more than 26,000 projects based on blockchain. However, only 8% of these projects are surviving.
Hope you don't get confused here between blockchain and Bitcoin - bitcoin is a cryptocurrency which is based on blockchain technology.
What is blockchain?
When you share a digital data to some other person, then all transaction-related information (encrypts) get stored in a block, but to complete a transaction, this information should be verified which is done by miners. They (miners) solve complex algorithms which verify the transaction and forms new block, this process is called mining. For their work, the miners are rewarded by the system. This whole mining process makes manipulation of any transaction impossible because all the blocks are connected. So, if you want to manipulate information from a certain block, you will have to undo all the blocks formed after that particular block, which is not possible.
Blockchain technology also prevents the problem of double-spending. Let's say, you have a bitcoin which is a digital data, so it's easy to duplicate it and use it on two different transactions. Miners verify each transaction and put a timestamp on a block. So, when you use a duplicate copy, the system identifies it and eliminates that transaction.
“The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”
– Don & Alex Tapscott, authors of Blockchain Revolution (2016)
‘Transaction’ here is not limited to cryptocurrency. It can be an exchange of currency, exchange of information and of contracts which can have conditions to fulfill (smart contracts). All together makes ‘virtually everything of value’.
Blockchain is a digital ledger which is present on multiple nodes (computer) connected with the network. And the data is updated on all the nodes, whenever a transaction takes place. Therefore, there is a transparency in the network. And there is no central authority for the blockchain to operate. So, the blockchain system can not be hacked or manipulated by anyone.
Besides that, you don't need to share your personal information with any central authority to use its services, this means your information can't be leaked, manipulated or destroyed by anyone.
“As revolutionary as it sounds, Blockchain truly is a mechanism to bring everyone to the highest degree of accountability. No more missed transactions, human or machine errors, or even an exchange that was not done with the consent of the parties involved. Above anything else, the most critical area where Blockchain helps is to guarantee the validity of a transaction by recording it not only on the main register but a connected distributed system of registers, all of which are connected through a secure validation mechanism.”
– Ian Khan, TEDx Speaker | Author | Technology Futurist
As mentioned above, any service which is developed using the blockchain technology will be in a decentralized form. So, there won't be any intermediary demanding you charges and your personal information.
Blockchain can change the WORLD!
Finance system
Cryptocurrency as a store of value is the hottest investment already and its globally accepted, so you escape all the hassle of obligations to handle your money on global aspects. What’s more? It's safer and trusted because it doesn't have central authorities and you can control your money as you want. So it's a quite obvious industry which will get disrupted.
Contracts and agreements
Contracts bond a personal by written or verbal form stating an agreement. It's a lengthy process to clarify contracts and its build upon trust. Smart contracts can set an exchange of assets when certain obligations are fulfilled, so you don't have to trust anyone as the technology is fulfilling your task. For example, smart contracts can use it to set insurance.
Voting and identification
In blockchain-based identification, we only need to have the key to unlock our whole information. Moreover, it can collect our information from all over the internet and present it in a single space. Finland is using blockchain for identification of voters. Even the Russian government is going to use the blockchain in the upcoming presidential election for the vote count.
Government
Just imagine all the government data will be decentralized and more transparent which bureaucracy might hate. Blockchain can help people to utilize the beneficiary provided by the government without any intermediary so delays and bureaucracy can be avoided as well.
Cloud storage
Wouldn't it be nice to get free online data storage and earn some value as well?
The space unused in your device can be used for storage for another person in exchange for crypto coins.
Filezilla, sia, storj, and maidsafe are a few well-known distributed cloud storage platform.
Social networking sites
Steemit is one of the first social platforms based on blockchain technology. This system rewards content creators. We have sola.ai which is combining social media with Al. Sapien.network is highly customizable and indorse.io is a platform to showcase your career profile and connect with people for a job opportunity, the list goes on. Furthermore, they are more advanced than a mainstream social platform but like any other technology, it will take time to evolve.
Blockchain is an innovation which is giving a platform for more innovation. It's very obvious that blockchain is still at an initial stage and like other growing technology, it's not going back. Countless new applications will be created. So, the above list is very limited and maybe, it's not too early to say that blockchain can take place in any type of industry, including data management and record-keeping.
“The ‘blockchain’ technology behind bitcoin could prove to be an ingredient of an entire new world of technology, as big as the internet itself, a wave of innovation that drives the middleman out of much commerce and leaves us much more free to exchange goods and services with people all over the world without going through corporate intermediaries. It could radically decentralize society itself, getting rid of the need for banks, governments, even companies, and politicians.”
– Matt Ridley, The Evolution of Everything: How New Ideas Emerge
Now that you know about the digital currency, cryptocurrency is no more a piece of Greek and Latin for you. So, it’s time for you to join the debate revolving around cryptocurrency and confidently take your stance on the same.
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