Cryptocurrency
Author
Forrest Stroud
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Cryptocurrency is an increasingly trending term referring to digital money that can be purchased, transferred, and/or sold securely using cryptography, which encrypts and protects the data used to help identify and track cryptocurrency transactions.
Unlike regular currency, which exists in tangible form or is backed by something tangible like gold, cryptocurrency is purely digital money and exists solely in the internet. Additionally, cryptocurrency, also known as cryptocoin, is not backed or managed by an authorized third party like a bank or government.
In other words, cryptocurrency exists as a secure, decentralized form of currency, with cryptocurrency transactions changed and verified by a network of computers that aren t affiliated with any one single entity.
Cryptocurrency
Image Credit: Wit Olszewski / Shutterstock
HOW CRYPTOCURRENCY TRANSACTIONS WORK
Cryptocurrency largely relies on a distributed ledger technology known as blockchain to provide both a transparent and secure means for tracking transactions and ownership of the cryptocurrency.
The data on a blockchain is meant to be shared while also adhering to the primary premises of cryptocurrency being decentralized, secure and anonymous. Transactions are generated and verified through a process called cryptocurrency mining, which utilizes compute power to solve complex math problems.
Cryptocurrency miners agree to share the compute power of their machines to validate and process cryptocurrency transactions, and in exchange the miners receive small portions of the digital currency.
CRYPTOCURRENCY’S EXPONENTIAL GROWTH AND FORMS OF CRYPTOCURRENCY
The most recognized form of cryptocurrency, Bitcoin, was created in 2008 and has seen its value increase exponentially in the past year. In just twelve months, the value of one Bitcoin skyrocketed from about $800 in January 2017 to over $13,000 shortly after the end of the year.
While Bitcoin may be the most well-known and used form of cryptocurrency, it certainly doesn’t have a monopoly on the cryptocurrency market. There are now more than 1,000 forms of cryptocurrency on the Internet today, and popular alternatives to Bitcoin such as Litecoin (developed in 2011), Ripple (2012), Dash (2014) and Ethereum (2015) have all attracted attention and market capitalization in recent years.
Now that you understand what cryptocurrency mining is and how it works, let’s take a few moments to understand the attraction of cryptocurrencies and why someone would want to mine them. A Quick Look at the Different Types of Cryptocurrenciesproxy bitcoin bitcoin earnings bitcoin 2020 доходность ethereum balance bitcoin капитализация bitcoin ethereum mist автомат bitcoin monero новости With this in mind, bitcoin developers have pioneered coloured coins that can act as stock in a company. The ‘color’ of the coin represents information about what ownership rights the private cryptographic key provides.bitcoin electrum the ethereum bitcoin investing ethereum github gif bitcoin nicehash bitcoin шифрование bitcoin network bitcoin php bitcoin reklama bitcoin bitcoin mine bitcoin king bitcoin лопнет ethereum platform cryptocurrency gold bitcoin кредит mining cryptocurrency wei ethereum email bitcoin bitcoin настройка криптовалют ethereum компания bitcoin monero minergate monero transaction bitcoin vps simple bitcoin Ключевое слово bitcoin монеты bitcoin changer 60 bitcoin bitcoin gpu форк ethereum аналоги bitcoin rinkeby ethereum ethereum картинки сложность ethereum майн bitcoin bitcoin биржа bitcoin vip kong bitcoin bitcoin loans bitcoin bloomberg bitcoin icon bitcoin electrum tether coinmarketcap bitcoin information bitcoin instagram история ethereum bitcoin forums форекс bitcoin bitcoin news bitcoin capital банк bitcoin bitcoin oil