Cryptocurrency is simply digital money, which in some cases is designed to be secure and anonymous. It is closely related to the Internet that uses cryptography. Basically, readable information becomes an unbreakable code to deal with all transfers and purchases made.
Cryptography has a history of World War II, when there was a need to communicate in the most secure way. Since then, its evolution has taken place and has now been digitized, where different elements of computer science and mathematical theory are used with the aim of securing online communications, money and information.
The first cryptocurrency
The first cryptocurrency was introduced in 2009 and is still known worldwide. Many more cryptocurrencies have been introduced in recent years and you can now find so many available on the internet.
How they work
This type of digital currency uses decentralized technology to allow different users to make secure payments and to save money without having to use a name or even go through a financial institution. They mostly run in a blockchain. Blockchain is the main book distributed publicly.
Cryptocurrency units are usually created through a process called mining. This usually involves the use of computer power. Doing so solves mathematical problems that can be very complicated in coin creation. Users are allowed to purchase currencies through brokers and then store them in cryptocurrencies so that they can be spent with ease.
Cryptocurrencies and the application of blockchain technology are still in their infancy when they are thought of in financial terms. More uses may arise in the future because it is not known what will be invented. The future of transactions in stocks, bonds and other financial assets could very well be traded in the future using cryptocurrency and blockchain technology.
Why use cryptocurrency?
One of the main features of these currencies is that they are secure and offer a level of anonymity that you won’t get anywhere else. There is no way to reverse or falsify a transaction. This is the biggest reason you should think about using them.
The rates charged in this type of currency are also quite low, which makes it a reliable option compared to conventional currency. Due to their decentralized nature, accounts can only be accessed by anyone, unlike banks that only open through authorization.
Cryptocurrency markets offer a new ATM and can sometimes be a great reward. You can make a very small investment in a very short period of time to find that it has become something great. However, it is important that the market can still be volatile and that there are risks associated with the purchase.