The internet is blowing up with references to Cryptocurrency, Bitcoin, & Blockchain… But what does it all mean?
If you spend any time on the internet or social media (your reading this so I presume you do), then you would of come across people discussing Crypto currencies like Bitcoin, Litecoin etc.. & technology called Blockchain.
This topic is heavy, and the internet has a plethora of information on all the areas you need to know. This is great, however I wanted to put together a VERY high overview post that should give you the things you need to know in <2mins. Then if you want to get involved with Crypto Currencies, I have provided some useful links to explore.
Please note – I am not a cryptocurrency, investing or financial expert, this is personal knowledge – I recommend you seek professional advice if you want to get involved.
So, what is Cryptocurrency?
The very first Cryptocurrency ‘Bitcoin’ became public knowledge in 2007/2008 when the unknown creator who goes by the name of ‘Satoshi Nakamoto’ announced he had developed a peer-to-peer electronic cash system. His mission, was to de-centralise the finance sector with no central authority.
In essence, Cryptocurrency is a limited number of encrypted entries within a public database. The currency has a network of peers across the internet, with each peer having a complete history of all transactions and matching real time balances.
For example, if I was to send some of my Cryptocurrency to someone, its basically a public key that shows and stamps the transaction, which is then publicly shared peer-2-peer.
What is a Cryptocurrency wallet?
You will also need to learn more about wallets – A crypto wallet is a secure digital wallet (can be cloud or hardware) which is used to store, send and receive cryptocurrencies. You will need to use a wallet if you want to get involved with Cryptocurrencies. You can either download software to make your own, or a lot of the trading platforms now offer digital wallets as part of the service. Just do your research on the security!
What is Blockchain?
Wikipedia gives a good overview of Blockchain:
A blockchain, originally block chain, is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Each block typically contains a hash pointer as a link to a previous block, a timestamp and transaction data. By design, blockchains are inherently resistant to modification of the data.
Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority.
The first blockchain was conceptualized in 2008 by an anonymous person or group known as Satoshi Nakamoto and implemented in 2009 as a core component of bitcoin where it serves as the public ledger for all transactions. The invention of the blockchain for bitcoin made it the first digital currency to solve the double spending problem without the need of a trusted authority or central server. The bitcoin design has been the inspiration for other applications.
Key facts about Cryptocurrencies
– Irreversible – There is no going back with a transaction
– Discreet – You can stay anonymous
– Rapid – Payments can be instant
– Secure – The highest level of encryption is used.
What are the main Cryptocurrencies?
There are lots out there, but the main ones making traction right now are:
Should I invest in a Cryptocurrency?
Only you can answer that question. I would recommend you learn about Cryptocurrencies & Blockchain in more detail, research the currencies and make an informed decision from your findings and risk threshold.
How can I get involved?
Again, you need to do your research but a good place to start is a public trading platform. The below 2 have good reviews: