All you need to know about Cryptocurrency

What exactly are crypto currencies really?

Cut off all the sound around cryptocurrencies and minimize it to a straightforward definition, you think it to be just constraint entries in databases, nobody can transform without accomplishing particular conditions. This might appear typical, but, contrary to popular belief this is often ways to define a money. Money is focused on a verified accessibility in a few kind of repository of accounts, amounts, and a process of transactions.

How miners create cash and confirm transactions

Let’s check out the system ruling the directories of cryptocurrencies. A cryptocurrency like Bitcoin involves a network of colleagues working together. Everyone involved in this chain of event keeps record of entire history of transactions and cross check their bank balance.

A transaction file that says, “Bob provides X Bitcoin to Alice” and is also authorized by Bob’s private key. It’s initial public key cryptography, nothing at all special in any way. After authorized, a purchase is operated in the network, delivered from one peer to almost every other peer. That is basic peer to peer technology. Little or nothing special in any way, again.

The transaction is well known almost immediately by the complete network. But only after a particular timeframe it gets affirmed.

Confirmation is a crucial principle in cryptocurrencies. You can say that cryptocurrencies are about confirmation.

As long as an exchange is unconfirmed, it is pending and can bemolded. Whenever a transaction is proved, it is defined as static. It cannot be reversed, it is part of any immutable record of historical ventures of the so-called blockchain.

Only miners can validate transactions. In a cryptocurrency-network that is their job. They take trades, stamp them as legitimate and pass on them in a chain of network. Following a proven transaction by the bitcoin miner, every note must be added to its data source.Because of this job, the miners get compensated with a token of the cryptocurrency, for example with Bitcoins. Because the miner’s activity is the one most significant part of cryptocurrency-system we have to stay for an instant and have a deeper look onto it.

What exactly are miners doing?

Principally every person can be considered a miner. Since a decentralized network does not have any specialist to delegate this, a cryptocurrency needs some type of mechanism to avoid it from abuse. Imagine someone creates a large number of peers and spreads forged deals. The machine would break immediately.

So, Satoshi establish the guideline that the miners need to get some work of these computers to be eligible for this task. Actually, they need to find a hash – something of your cryptographic function – that links the new stop with its forerunner. That is called the Proof-of-Work. In Bitcoin, it is dependent on the SHA 256 Hash algorithm.


The very idea of a cryptocurrency, especially one as big as bitcoin creates a lot of tension as a lot of economic activities and financial operations have already being disrupted since its rise. It has affected the way banks operate and this has made governments and financial institutions wary of the economic powers they have and how crptocurrencies will change all of that in the nearest future. The several ways in which bitcoin is affecting the economy, banking and finance are:

  1. Money politicization – bitcoin being a cryptocurrency is decentralized and not under central banks and so the transactions on bitcoin cannot be monitored or regulated through central bank. This shifts the economic power they had from the government to the masses.
  1. Encouraging the dark web – the dark web is where activities such as the finding of weapons, assails and many illegal stuffs, and as such, you cannot easily access the dark web just through the search engine and can only be found with special software and browsers which allows you to delve deeper into the internet. With the emergence of crypto currencies, transactions on the dark web can be made and these illegal buyers and sellers of illegal stuffs will remain anonymous, therefore, bitcoin is seen as one of the available ways in which power is given to them and this will eventually lead to more cybercrimes.
  1. Speculations and gains – this usually isn’t bad news for the masses, but the steady rise and fall of bitcoin value has proven to be a thing of marvel, but since its inception, it is certainly more on the rising edge than otherwise and this has made people to give speculations of gains on their investment, as the opportunity to invest very little and gain incredibly large is something very juicy to the masses and naturally knock others opportunities of shares and stock out of the way.
  1. Anxiety among central banks – Bitcoin is unpredictable and uncontrollable, this has made it difficult to monitor moneylaundering across the globe by the central banks, weakening their powers on financial matters as regards digital currencies.