Cryptocurrency - What is It?
My ongoing battle with my bank to restore online facilities has prompted this! A £25 per month "members fee" and I'm having to resort to posting cheques! My consolation?
I'll not need a bank by the end of 2019.
Neither will you.
The last financial crisis in 2008 heralded the dawn of alternative, or digital, or - because of the in-built security - crypto currencies. The objective of the inventors was to improve on fiat currencies - sterling, dollars, euros etc.
How? By being secure, trustworthy and most important, independent.
Cryptocurrencies are not controlled by a central bank or government; the concept is similar to internet file sharing services - like music and movies. Cryptocurrencies use the same approach but with a financial ledger replacing the media file. This ledger retains records of every transaction on the network; encryption is used to ensure it cannot be hacked.
Cryptocurrencies use a "blockchain" - the distributed ledger of these encrypted records providing an immutable data base than cannot be edited, only added to. Each transaction is authorised and "signed" by the sender using encryption. Transactions can be checked using a "public key" without disclosing details of the private user.
Groups of transactions become "blocks" which are added to an ever expanding chain of blocks; each block has an additional layer of encryption security making it impossible to retroactively revise the "blockchain".
Critics point to the seemingly inherent fluctuations in value and to a lack of utility.
Those who seek to make money by trading - selling and buying when "experts" provide the green light - are one reason why values fluctuate. These fluctuations are not unlike the exchange rates of fiat currencies. Unlike fiat currencies, this decentralised form of money is not influenced by the economic policy of the prevailing Government.
As to utility, from June this year, cryptocurrency can be freely spent anywhere in the world, so long as the retailer/merchant/service provider accepts credit cards. Said receiver will be unaware that payment is from the crypto account as payment is received in the receivers preferred currency.
Not just clever - GROUNDBREAKING.
This incredible advancement means that cryptocurrency is on the verge of becoming mainstream.
With the ongoing, seemingly unsolvable problems in our banking system, not to mention identity theft as well as an ever reducing need to actually carry cash, now is the time to learn about Blockchain and cryptocurrency.