Cryptocurrency is the new exciting technology at present which is poised to disrupt the way the financial transactions take place. They have represented a paradigm shift in how the money is sent, spent or invested. These cryptocurrencies have been in market since 8 years but have created a market value of about $170 billion. The media has spotlighted and paved a way for more people to dwelve into the world of cryptos and understand about its purposes.

Cryptocurrency which is a form of digital cash or distributed digital currency allow a seamless, fast and direct transactions between the parties. The users have a full control over the payments and balances , they can earn and spend with a lot of ease and transparency. As they have full control over the cryptocurrency they need not rely on the central authority to validate the transactions , the validation for the cryptocurrency is done by its network.

For a fiat or traditional currency banks, credit card companies and few other entities act as gate keepers to protect the information and the money, where in turn they charge fees to manage the transactions to ensure that everything is in place. But cryptocurrencies do not require any central authorities and its transactions are managed in a distributed fashion. These cryptocurrencies are not susceptible to any kind of hacking as its data is distributed and stored at one central location. Adding to that the transactions with cryptocurrencies are processed in a matter of minutes or seconds, and not like the fiat currencies which take hours or days for the transactions to take place.

Cryptocurrencies are referred as coins as they are stored in digital wallets to make payments. The digital wallets are protected by a private key, which is an extremely complex password. The user can spend or send money by submitting the transactions from the wallet. Similar to the traditional currency, crypto currency can also be spent the same way as the user wishes to.

The only difference is these cryptocurrencies are not physical but digital which can be paid through wallet app which is available on the phone using a special key for transactions, which is actually a better and easier way to use.

Cryptocurrency was actually developed as an application to a cryptographic invention called blockchain technology. Blockchain supports multiple technologies and cryptocurrency is one such technology. These cryptocurrencies which are available today would not have been possible without the Blockchain. Blockchain consists a block which is a complex mathematical problem based on the cryptographic technology called hash which works on the computers and aims to solve it. These blocks add on to form a chain.

Checkout the following infographic on Thirty Three Cryptocurrencies Described in Four Words or Less, developed by our friends at Mrbtc.org.

Hitesh Malviya

Hitesh Malviya is the Founder of ItsBlockchain. He is one of the most early adopters of blockchain & cryptocurrency enthusiast in India. After being into space for a few years, he started IBC in 2016 to help other early adopters learn about the technology.
Before IBC, Hitesh has founded 4 companies in the cyber security & IT space.