What is Crypto Currency ?

1 Jun 2022

What Is Crypto Currency ?
imagine you're having conversation with

your friends now at some point in this

conversation someone's going to bring up

crypto currencies now crypto currencies

is something that everyone wants to talk

about but no one really knows how they

work so today I'm going to fix that

I am route from simply learn and this is

crypto currency explained since man

world currency has been a very important

part of our lives in the caveman era

they use the barter system now the

barter system involves goods and

services being exchanged among each

other so now we have a situation where a

caveman is exchanging seven apples and

getting oranges in return

now the barter system fell out of use

because it had some glaring flaws

now these flaws include having people's

requirements coincide for example say

you have Phi apples and your friend has

five oranges you want some of his

oranges now until and unless your friend

has a requirement for the apples that

you own he'll not be ready to make an

exchange for it there's no common

measure of value now since there's no

common measure in terms of which value

of a commodity can be expressed there's

a problem when you have to decide how

many apples you are ready to trade for

one orange or a mango not all codes can

be divided or subdivided for example you

can divide a live animal into different

smaller units the goods cannot be

transported easily now unlike our modern

currency fits in your wallet or your

mobile phone the goods that you own

cannot be taken with you everywhere you

go after realizing that the barter

system then work very well

currency went through a few iterations

in 110 BC an official currency was

minted in thousand 250 AD gold plated

Florence was introduced and this was

used across Europe and from 1680 to 1980

paper currency gained widespread

popularity and was used across the world

this is how modern currency as we know

it came into existence modern currency

included paper currency and coins credit

cards and digital wallets for example

you have Apple pay Amazon pay pay DM Pay

Pal and so on all of this was controlled

by banks and governments now this means

that there was a centralized regulatory

authority the delimited how paper

currency and credit cards worked now

imagine the scenario of doing an online

transaction here you're thanking your

friend for paying for your lunch are you

saying that you're sending the money to

their account now this transaction takes

place successfully but there are several

ways where this could have gone wrong

they could have been a technical issue

at the bank for example the systems

could have been

the machines weren't working properly

and so on that means there's a central

point of failure which is the bank the

users accounts could have gotten hacked

for example they could have been a DDoS

attack or identity theft and so on or

the transfer limits for that account

were exceeded this is why the future of

currency lies with cryptocurrency now

imagine the transaction between two

people in the future one of them has the

Bitcoin app and there's a notification

asking whether they sure they're ready

to transfer five bitcoins if yes

processing takes place here we're

authenticating the users identity

checking whether they have the required

balance to make that transaction and

other things now after that's done the

payment is transferred and the payment

is received all of this happens in the

matter of minutes and is as simple as


this in turn removes all the problems of

modern banking there's no limits to the

funds you can transfer your accounts

cannot be hacked and there's no central

point of failure now as of 2018 there's

more than 1,600 cryptocurrencies

available now there are some popular

ones like Bitcoin litecoin it's Harry

amends each cash and a new

cryptocurrency crops up every single day

now considering how much growth they're

having at the moment there's a good

chance there's plenty more to come in

the upcoming years so what exactly is

cryptocurrency a cryptocurrency is a

digital or virtual currency that is

meant to be a medium of exchange

now cryptocurrency is quite similar to

real-world currency just that it does

not have any physical embodiment it also

uses cryptography to work the way it

does now some of the features of

cryptocurrency are that there's a limit

to how many units can exist with Bitcoin

this limit exists at 21 million now

after this no more bitcoins will be

produced you can easily verify the

transfer of funds now the hashing

algorithms that Bitcoin uses makes it

very easy for users to determine whether

a transaction is valid or not they

operate independent of a bank or a

central authority they work in a

decentralized manner now new units can

be added only after certain conditions

are met for example for Bitcoin only

after block has been added to the

blockchain will the miner be rewarded

with bitcoins and this is the only way

new bitcoins can be generated so what

makes cryptocurrency so special firstly

there's little to no transaction costs

now if you use the digital wallet you'll

know that if you're transferring money

from your wallet to your bank account

you lose some amount of money you have

24/7 access to money you can't just walk

up to your bank at 3 a.m.

morning and say that you want to

withdraw some money there's no limits on

purchases and Madras there's freedom for

anyone to use for example if you are

setting up an account in your bank you

need to do some amount of paperwork and

documentation with cryptocurrencies all

of that can be avoided international

transactions are faster the wire

transfers take about half a day to

transfer money from one place to another

but with cryptocurrencies

it only takes a matter of minutes or

seconds what's the crypto in


crypto navistick or Prague Rafi it's a

method of using encryption and

decryption to secure communication in

the presence of third parties with ill

intent now this refers to third parties

who want to steal your data or want to

eavesdrop on your conversation

cryptography uses computational

algorithms like sha-256 which is the

hashing algorithm that Bitcoin uses a

public key which is like a digital

identity of the user with he shares with

everyone and a private key which is a

digital signature of the user which he

keeps hidden now let's talk about a

normal Bitcoin transaction first you

have the transaction details now this

details who you want to send it to and

how much bitcoins you want to send them

then it's passed through a hashing

algorithm for Bitcoin we use the sha-256

algorithm the output that you obtain is

passed through a signature algorithm

with the users private key now this is

used to uniquely identify the user this

output is then distributed across the

network for people to verify this is

done by using the sender's public key

the people who verify the transaction to

check whether it's valid or not unknown

as - now after this is done the

transaction and several others are added

to the blockchain where it cannot be

changed again if the concepts of hashing

seem a little difficult to you I would

suggest you click on the top right

corner and watch the blockchain explain

video so that you can understand better

now the sha-256 algorithm like I told

you earlier looks something like this

now seeing how complicated it looks i'm

sure it's safe to say that the

encryption is very difficult to hack

today we will be focusing on two major

crypto currencies Bitcoin and ether now

bitcoin is a digital currency that is

decentralized and works on the

blockchain technology it uses a

peer-to-peer network to perform

transactions let's talk about ether

ether is a currency that's accepted in

the etherium Network now the etherium

network uses blockchain technology to

create an open-source platform for

building and deploying decentralized

applications now let's talk about the


VidCon and ether they are the biggest

and most valuable cryptocurrencies in

the market right now both of them use

blockchain technology which is nothing

but a technology that involves

transactions being added to a container

called bloc and creating a chain of

blocks in which data cannot be altered

currency is mine using a method called

proof-of-work which is a form of

mathematical puzzle that needs to be

solved before a block can be added to

the blockchain finally these are widely

used across the world now let's talk

about the differences with Bitcoin it is

used to send money to someone this is

very similar to how real-life currency

works with ether it is used as a

currency within the etherium Network

although it can be used for real-life

transactions as well Bitcoin

transactions are manual which means you

have to personally perform these

transactions with ether you have the

option to make these transactions manual

or automatic or programmable which means

that these transactions will take place

when a certain conditions been met for

Bitcoin it takes 10 minutes to perform a

transaction which is the amount of time

it takes for a block to be added to the

blockchain with ether it takes about 20

seconds to do a transaction no

blockchain is used like money for real

my transactions and ether is used to

power the etherium network and power

real-life transactions as well ether is

used as fuel within the etherium network

to power both of these things now there

is a limit to how many bitcoins can

exist which is 21 million we supposed to

hit this number by the year 2140

ether is expected to be around for a

while but not to exceed 100 million

units the Bitcoin is used for

transactions involving goods and

services and ether uses blockchain

technology to create a ledger to trigger

a transaction when a certain condition

is met for Bitcoin we use an algorithm

called associate 256 for hashing and

with a theorem we use eg hash as of July

23rd 2018 one Bitcoin equals seven

thousand six hundred sixty eight dollars

for ether it costs four hundred and

sixty four dollars now what's the future

of cryptocurrencies

the whole world is clearly divided when

it comes to cryptocurrencies

on one side you have supporters like

Bill Gates Al Gore and Richard Branson

who say that cryptocurrencies are better

than regular currencies on the other

side we have people completely against

it people like Warren Buffet Paul

Krugman and Richard Schiller who are

both Nobel Prize winners in the field of

economics they call it a Ponzi scheme

and means for criminal

in the future there's going to be a

conflict between regulation and

anonymity since several cryptocurrencies

have been linked with terrorist attacks

governments would want to regulate how

cryptocurrencies work on the other hand

the main emphasis of cryptocurrencies

is to ensure that their users are kept

anonymous by the year 2030

cryptocurrencies would occupy 25% of

national currencies which means the

significant chunk of the world would

start believing in cryptocurrency as a

mode of transaction it's going to be

increasingly accepted by merchants and

customers and it will continue to have a

volatile nature which means prices will

continue to fluctuate like they have

been for the last few years with that

we've reached the end of another video I

hope you guys found this informative and

helpful if you have any feedback or

doubts put them down in the comments

below we'll be happy to help you thank

you for watching and stay tuned for more

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