BITCOIN AND CRYPTOCURRENCY

For a long time, I have been hearing about Bitcoin and Cryptocurrency. Maybe, for that reason my curiosity to know about these two terminologies has increased to a greater extent. So I tried to put my nose on to it just to acquire knowledge as much as I could. After a bit research, I have come up with few things that I think I must share with my readers. The advantage that you are going to get after reading this article is, you will have a basic idea about Bitcoin or Cryptocurrency and how it works.

INTRODUCTION:

First and foremost, Bitcoin and Cryptocurrency are two different words. Cryptocurrency is a cryptographed digital currency means it is encrypted with secret codes. It is just to ensure three things, secure transaction, control re-creation and verify the transfer of funds. It is also called virtual currency or alternative currency, which means, it is not at all a physical currency. On the other hand, bitcoin is just a type of Cryptocurrency. The concept of Cryptocurrency was first described by Wei Dai in 1998. But the bitcoin was designed and created by an unknown figure called Satoshi Nakamoto in the year 2009.

HOW BITCOIN WORKS:

Since bitcoin is a digital currency so its transactions and exchanges are completely digital. Now, u may have a question in mind like, how can someone measure the legitimacy of such transactions? Means, you have a bitcoin, and you want to give it to your friend John. Now, how can John be assured that you haven’t already sent your bitcoin to your friend Harry as email attachment earlier or you have already made several copies of your bitcoin and stored it to your computer?  Or maybe you had put it up on the internet and thousands of people already downloaded it.

To overcome the issue the creator of Bitcoin came up with a solution, it’s called Blockchain which is nothing but a digital ledger. It keeps the records of all transactions that take place digitally. And to root out any discrepancies or probable anomalies and frauds, this digital ledger is not specifically placed in a certain place in a certain computer. Rather, it is managed and maintained by each and everyone, involved in that Blockchain under open distributed ledger system. Anyone can participate in that network. Moreover, one has to be within the system, to be a part of the system or that network.  And, by participating and contributing towards the updating and maintaining of the digital ledger or the Blockchain one can receive bitcoin as a reward. In fact, it is the only way to create more bitcoins in the system. Which is also called Mining.   

CONCLUSION:

Bitcoin is said to carry a high value, and it’s value increasing day by day. The reason is, it is limited in numbers and has higher utility. Moreover, there is another reason for its popularity, that is, the identity of the transacting parties always remains hidden.  Still, there are debates going on between various groups whether it is useful or not. But the way technology is advancing, maybe one-day bitcoin will be accepted as one and only Global Currency. Till then, just wait and watch.