Cryptocurrency: All you need to know
Cryptocurrency has been new fuzz in recent years as a new form of currency. Cryptocurrency is a medium of exchange, created and stored electronically in the blockchain, using encryption techniques to control the creation of monetary units and to verify the transfer of funds. Bitcoin is the best example. It is a digital or virtual currency which has been secured by cryptography. It is impossible to counterfeit this currency or double-spend it. Most of the cryptocurrencies are having decentralized networks which are based on blockchain technology. A Cryptocurrency has no intrinsic value in that is not redeemable for another commodity such as gold. It has no physical form and exists only in the network. Its supply is not determined by a central bank and the network is completely decentralized.
Basically, it is a new form of a digital asset which is dispersed to a huge number of computers on a network. This structure and decentralization enable the Cryptocurrency to exist beyond the control of governments and central authorities. Since it is an encrypted form of money it is termed as “Cryptocurrency”.
In many countries, cryptocurrencies have also been criticized for many different reasons such as using Cryptocurrency for illegal activities, exchange rate volatility, and the supported infrastructure vulnerabilities. But they also receive commendation for their portability, divisibility, inflation resistance, as well as transparency.
Role of Blockchain technology in Cryptocurrency:
Cryptocurrencies are decentralized networks based on blockchain technology. With this technology, the participants can make transactions without involving any central clearing authority. Some of the applications of blockchain technology include fund transfers, settling trades, voting, and many other issues.
How does blockchain technology work?
Here is the complete working of blockchain technology:
- Someone in the network requests for a transaction
- The requested transaction is broadcast to a P2P network consisting of computers, known as nodes.
- The network of nodes validates the transaction and the user’s status using known algorithms.
- A verified transaction can involve cryptocurrency, contracts, records or other information.
- Once verified, the transaction is combined with other transactions to create a new block of data for the ledger.
- The new block is then added to the existing blockchain, in a way that is permanent and unalterable.
- Finally, the transaction is completed.
Applications of Blockchain Technology:
- Automotive: Consumers could use the blockchain to manage fractional ownership in autonomous cars.
- Financial Services: Faster, cheaper settlements could save billions of dollars from transaction costs while improving transparency.
- Voting: Using a blockchain code, constituents could cast votes via smartphone, tablet or computer, resulting in immediately verifiable results.
- Healthcare: Patients’ encrypted health information or records can be share with multiple providers without the risk of privacy breaches.
Blockchain’s benefits and unknowns:
- Increased Transparenc
- Accurate tracking
- Permanent ledger
- Cost reduction
- Complex technology
- Regulatory implication
- Implementation challenges
- Competing platforms
Python Technology for blockchain:
Python technology is amongst the best technologies for blockchain. It is quite advanced and easy to learn and is supported by a large and passionate community of developers. It guarantees stability and reliability. Python is also quite simple and minimalistic in nature, and highly populated. It can be run compiled or uncompiled which makes developers’ lives more comfortable. It has free packages for Blockchain to developers write code more efficiently. A developer can create a simple blockchain using Python in less than 50 lines of code.