What is the meaning of the Cryptocurrency?

A Cryptocurrency is a digital form of currency available virtually; it is independent of the interference of the government and can be used in the exchange of services and goods. Since it is digitally available, it has to be secured so that there can be no duplicate or multiple usages. This is done by securing it with cryptography (encryption).

Cryptocurrency is generated digitally and works as an asset available on a network across a large number of computers. These are issued by various companies, and their spending is restricted to particular goods and services.

The history of cryptocurrency came way to log back from 1983, and the first decentralized cryptocurrency that was developed was termed bitcoin in 2009. The history of how bitcoin was developed and who invented bitcoin is anonymous and is known to have developed pseudonymously by Satoshi Nakamoto. Once bitcoin gained its name and was known amongst people, Namecoin was developed in April 2011.

After Bitcoin, various other cryptographic currencies marked their presence but did not gain as much popularity as bitcoin. After the name coin, which used DNS, Litecoin was released in November 2011. After the name coin, another notable one was introduced with the name of Peercoin.

How does Cryptocurrency work?

The cryptocurrency is a digital asset, and this can be understood in simpler terms such that it is not governed by the government but solely by the users or computer algorithms. Cryptocurrency in any form as of now is available online for Dollars, it can be purchased, or it can be exchanged for goods and services, or it can be interchanged with any other kind of cryptocurrencies.

They are managed in a cryptocurrency wallet, just like we have the common wallets. It is done digitally such that one person creates a transaction and uses a wallet to transfer the balances from one public address to another. These transactions are notified in a set of keystrokes, and these keystrokes determine the number of a cryptocurrency. The person who has the passcode is the owner of that amount of cryptocurrencies. These transactions occur digitally and are recorded on a digital ledger. This digital public ledger that has all the transaction history is known as Blockchain.

Cryptocurrencies do not have a fixed value, so their value keeps on changing and fluctuating based on the market conditions.

Is the transaction with cryptocurrency safe?

The transaction done with cryptocurrency is not much safe as it is not irreversible. The cryptocurrencies do not have the same legal protections as the various traditional methods such as credit cards or other digital payments. 

All the approved transactions from the formation of the cryptocurrency are stored in the public ledger. The identity of the owner is, however, encrypted, and the cryptographic technique is used for record-keeping.

Once the transaction is completed from the wallet, a confirmation process starts that is known as Mining. This process of confirming the transaction involves solving a complex computational puzzle. It is open, and anyone can confirm the transaction. There is a system of adding Blocks such that the first miner adds a block of the transaction to the ledger. Adding or changing the block is not an easy task as it is done in collaboration among transaction, blocks, and public blockchain ledger. And the addition of any block makes the transaction permanent. This mining process is essential as it gives value to the coin.

Types of Cryptocurrencies

There are many cryptocurrencies, some of them which are very famous are as follows:

• Bitcoin (BTC): It is the most famous form of cryptocurrency that was invented in 2009. Bitcoin users control the sending and receiving of money allowing anonymous transactions to take place around the world.
• Litecoin: This cryptocurrency was launched in 2011; it is similar to bitcoin; the difference is in the worth of the coin. This coin has a worth of 24 million.
• Ethereum (ETH): This is an open-source platform that is based on blockchain technology. It focuses on running the program code of the decentralized application and using it, and the developers can also pay their transaction fees and services.
• Bitcoin Cash (BCH): It was launched to improve the features of Bitcoin such that it increases the size of blocks that helps to process the transaction faster.
• Zcash (ZEC): This cryptocurrency is also based on a decentralized blockchain. It helps in keeping the sender, receiver, and the amount transacted anonymously.
• Stellar Lumen (XLM): This cryptocurrency launched in 2014 is based on the exchange of currencies such that anyone having one kind of currency can send it to some other person in exchange for any other kind of currency.
• Ethereum Classic (ETC): These are advanced versions of Ethereum that run smart contracts and run exactly as programmed making it more secure. It provides a value token known as classic ether with which users can pay for products and services.
• Ripple (XRP): This is a digital asset that is open-source and does not require any kind of permission, and the fastest mode of transaction.

Cryptocurrency in India

Earlier in 2018, RBI had laid a partial ban on Bitcoin cryptocurrency, but it has been removed, and so it is a full-fledged asset that has been noticed in 2021. It is traded similarly to normal stocks. The online platform provides crypto-crypto transactions. There is also an option of crypto-INR currency exchange pair available.

There is also the availability of BTC and LTC as a currency pair. So, crypto trading is prevalent in the Indian market. And for obtaining profit, it is important to be updated about the trends in the market.

Future aspects of cryptocurrency

Cryptocurrency is the digital asset, is the most common form of transaction that takes place these days in this digital world. As the world goes digital, it can even replace cash currency and will increase many folds by 2030 as per Deutsche Bank. As per the latest information, bitcoin has increased its value by 202%.

Facebook is planning to launch Diem with its partners that will be a type of cryptocurrency called Libra. It is a blockchain permission payment system proposed by Facebook.

As per the latest information, Bitcoin is considered the most favorable investment source and has the potential store of value similar to Gold. Hence, investing in Bitcoin in 2021 can be considered.