Introduction to Crypto, Blockchain and BTC
Cryptocurrency gained immense popularity within a decade of its existence. But ever since its introduction, while the technology is advancing rapidly, the debate over its ability to replace existing forms of currency has remained as wild as day one, only the number of people on both sides of the camp is increasing. To begin to understand the debate, it is important to go back to the basics.
According to Oswego State University of New York, a cryptocurrency is a virtual currency, which enables the transfer of money based on encrypted algorithms. The use of encryption technology has crypto both as a digital currency and also as a coded accounting system. Some major cryptocurrencies are Bitcoin (BTC), Ethereum (ETH), Solana (SOL), Dogecoin (DOGE), etc.
As described by Forbes, BTC was the first crypto, and is the most famous among the 19,000 different cryptocurrencies. BTC was created by an anonymous identity or group of people called Satoshi Nakamoto, with the goal of establishing “an electronic payment system based on cryptographic proof rather than trust.”
BTC is based on a distributed digital system meant for recording transactions called Blockchain. It is a completely interconnected data set, formed by combining subunits called blocks that consist of complete information about each transfer. They are finally linked together in a chronological order, of an outcome like chains of blocks. The information and the order of the transactions (the order of the blocks) cannot be changed.
Crypto is gradually seeping into various sectors; its extensive adaptability has made the masses see its benefits. In 2021, El Salvador was the first nation in the world to declare BTC as an official currency in a legislative assembly. Subsequently, the Central African Republic adopted BTC as legal tender in April 2022.
In accordance Investopedia, Blockchain is a technology that has proven to be a game changer for a large number of industries, from banking, healthcare, sports, food and many more. The biggest plus point offered by it is the removal of middlemen, authorities and centralized body, making it completely centralized.
Stability, although controversial, is another advantage that can be seen in crypto, due to its limited supply, unlike fiat currency. But major events such as the ongoing Russia-Ukraine war, Europe’s energy crisis have called into question the deflation promises made to the crypto investors.
BTC was currently trading at $16,571.35 at the time of writing. This year’s crypto winter weighed heavily on BTC – it struggled to cross the $20,000 mark. Although those who believe in the huge potential of the crypto industry will stick to the arena, as BTC bounces back every time it is dragged to the ground. Only 21 million bitcoins will be in circulation according to the original code. However, that limit can be increased based on demand.
Disclaimer: The views expressed in the article belong solely to the author. Readers are advised to “DYOR” by their page. Any financial loss or damage incurred by the reader is absolutely their responsibility.
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional money exchange systems. She is also fascinated by the blockchain technology and its function.
