Blockchain and Crypto; What's all this fuzz about?

well! you might be overwhelmed with all the news about the crypto and the blockchain technology. but what the hell is it? right?

Photo by André François McKenzie on Unsplash

Cryptocurrency is different from the traditional currency, fundamentally because the traditional currencies are controlled and logged by an entity(governments, banks, etc.), whereas the cryptocurrencies are decentralized logged by different nodes around the world, whom we call miners and while doing this they get a small reward. the cryptocurrency is build on the blockchain technology. blockchain is a series of data-blocks connected like a chain and linked one after the other using cryptography. each block store the transaction data, time and a hash of previous block.

in this way each block is connected and a new block is added whenever a transaction is made and eventually forming a chain. the copy of this chain is stored in nodes all around the world. so if someone tries to manipulate a block by altering the data, the hash-code of the block changes and it will be disconnected from the subsequent blocks

so in-order to manipulate the data they will have to alter the rest of the blocks, but still the nodes around the world compares the chain with each other and if the chains are not matching it will rectify the chain.

so in-order to work around that, the manipulator will have to take control of the majority of the nodes simultaneously which is considered impossible. hence, making the blockchain technology very secure.

Advantages of cryptocurrency

• It is not controlled by an entity

The traditional currency is controlled by the government and the bank keep the log of transactions. but unlike this, the crypto is controlled by the algorithm and the logs are stored in the nodes around the world

• Can be transferred around the world very quick

Usually transferring money from Europe to Asia takes a day to complete, whereas using crypto we could transfer the amount in the matter of minutes

• Ease of trade

The crypto can be very useful in the international trade because of the ease of transferring the money

• The value is dependent on the whole world rather than a region or a country

In the occurrence of an event, the value of currency may fluctuate very badly. events like war or economic crisis can decrease the value of currency very drastically. but in crypto(excluding the govt backed national crypto) the value is depended on events occurred in vast majority of the regions

• A transaction cannot be undone

This is a major advantage for crypto, this function can stop a lot of fugitives from stealing the money from banks and also from creating financial scandals from happening

Examples of cryptocurrency

• Bitcoin
• Ethereum
• Litecoin
• Cardano

The cryptocurrency and blockchain technology are a very new thing to most of the people, though it existed for a decade or long. The cryptocurrency gained its popularity when bitcoin’s value was skyrocketing. bitcoin is the first generation of crypto, other coins excluding bitcoin are called Alt coins. The fundamentals and principals of the currency is engraved into the algorithm. so each coins differ from each other. Not all the coins are limited in supply, for example Ethereum has no cap. whereas Bitcoin is limited in supply. there will always be only 21 million coins.