Meaning of Cryptocurrency
Cryptocurrency or cryptocurrency is the nomenclature used to refer to digital currency , money that is encrypted to guarantee its protection and security. This monetary value , unlike traditional currency, exists only in the virtual universe.
Like other types of currencies , cryptocurrency is used to purchase goods and services. But its main advantage is the fact that it is not tied to any banking system.
For this reason, your transfer via the Internet , for example, becomes cheaper, since it is not necessary to pay fees to financial institutions.
The encryption of these coins is done through a series of source codes that are very difficult to crack, especially by hackers and other online criminals.
Characteristics of Cryptocurrencies
As stated, the main feature of cryptocurrency is that it is a decentralized system , avoiding the need for management by central bodies, such as financial institutions and banks, for example.
Anyone can buy or sell cryptocurrencies by buying them on online markets, for example. To do this, simply use “ traditional money ” to buy credits that will allow you to buy the first few cryptocurrencies.
The value of cryptocurrencies is quite volatile , with the value of 1 bitcoin ranging from tens to thousands of dollars, for example.
In addition to Bitcoin, one of the most popular digital currencies in the world , there are several other cryptocurrency units, such as Litecoin, BlackCoin, Aeon, Monero, and many others.
In fact, all other alternative currencies to bitcoin are called altcoins, whether or not they are based on BlockChain, digital currency registry bases.
How Did Cryptocurrencies Emerge?
The origin of cryptocurrencies comes from the cyberpunks , a group of individuals with a countercultural view of society .
They believe in a world free of imposed standards, with total freedom and far from excessive government controls.
Cyberpunks have a vision close to anarchism , defending inalienable privacy. They also dominate futuristic technological systems and tools.
After bitgold and b-money, cryptocurrencies that were never used, Satoshi Nakamoto (a pseudonym for an individual or group of individuals) developed the basic concept of bitcoin and launched it into the air.
Since then, cryptocurrency has gained traction, especially after 2013, when taxpayers in the Republic of Cyprus had their savings confiscated and had to look for alternatives outside of traditional banks.
Currently, more than 14 thousand establishments offer bitcoins as forms of payment.
Advantages of Cryptocurrencies
As they are carried out independently, without the need for any bank involvement , cryptocurrencies represent ease in transactions and less interference from the State in their regulation.
In this way, price fluctuations occur by pure supply and demand. Furthermore, the complex blockchain technology and cryptography involving digital currencies ensures the security of transactions.
Each coin has a unique code and a specific identification number, which can only be transferred by those who have it. Because they are decentralized and produced by various “ miners ” (cryptocurrency-producing users), it is also more difficult for hackers to act.