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Crytpto Curency definition, types and examples.

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Lately there's been a lot of talk about bitcoin so is this a new currency ? how it works ? Many cryptocurrencies are decentralized networks based on blockchain technology. generally not issued by a central authority, making them theoretically immune to government interference or manipulation.


Cryptocurrency, What is this ?

Maybe some of you already hear about Cryptocurrency, for you who just not knowing what is this currency, how the system works how to get it, may be this will help you out a little bit understanding about cryptopcurrency

Cryptocurrency is a virtual currency that secured by cryptography, what is cryptography?

Cryptography are almost exclusively to encryption, these are process of converting ordinary information from plaintext into ciphertext. This cryptocurrencies are decentralized networks on blockchain technology.

Crypto is a collection of binary data, is design to work as medium exchange. Generally this cryptocurrency are fiat currency they are not backed into a commodity.

Do you think this cryptocurrency has a physical form ?, the answer is no. cryptocurrency are not like paper money or coin that we always use in daily transaction.

When the cryptocurrency created it is generally considered centralized. And also this cryptocurrency is tradeable digital asset, built on blockchain that only exists online.

There are so many cryptocurrency even over a thousand cryptocurrency in the world.

Blockchain is a set of connected blocks. Each block contains a set of transactions that have been verified by member of the network. Before the blockchain is confirmed, every block are verified each node, almost impossible to forge transaction histories.

Markets in Crypto Assets (MiCA) regulation are released in June 2021. the regulation are sets safeguards for regulation and establishes rules for companies or vendors that providing financial services using cryptocurrencies.


Is cryptocurrencies legal ?

Fiat money is a government-issued currency that is not backed by a physical commodity, but rather by the government that issued it.

In December 2021, El Savador was the only country in the world to allow Bitcoin to become a legal tender for transactions. and the rest country, cryptocurrency regulation varies by juridiction.

For some of the country, cryptocurrency are legal property. Cryptocurrency exchances operating in the country are subject to collent some information about the customer relating to the wire transfer.


Cryptocurrency, Advantages and Disadvantages

The purpose and intent of Cryptocurrency being introduced is to revolutionize the financial infrastructure. there are many differences between the theoretical ideal of a decentralized system and cryptocurrencies.

Advantages of Cryptocurrency

  • Cryptocurrencies represent a new way of looking at decentralization for money. In this system, centralized intermediaries, thus financial institutions, are not required to enforce trust and police transactions between two parties. Thus, the cryptocurrency system eliminates the possibility of a single point of failure, such as triggering a series of crises around the world.
  • What we currently encounter is the use of cryptocurrencies in remittances. such as Bitcoin which is used as an intermediary currency for cross-border currency transfers. thus, the currency that we generally use is converted to Bitcoin or other cryptocurrencies which can then be converted to the destination currency. this is a method of simplifying the remittance process.
  • Profits from investing in Cryptocurrencies are currently over $800 billion in the crypto market. Cryptocurrency market has skyrocketed in value lately. so it is the right choice to invest in Cryptocurrency.

Disadvantages of Cryptocurrency

  • Blockchain cryptocurrencies are very secure, but like crypto repositories, exchanges to wallets can be hacked. Many cryptocurrency wallets have been hacked, with even millions of dollars worth of coins missing being hacked.
  • Cryptocurrencies are meant to be decentralized, their wealth or profits being distributed among many parties on the blockchain. but in reality, this ownership is highly concentrated. as in an MIT study found that crypto currencies, which have soared in value recently, are held by several investors.
  • Cryptocurrency is a tool used for criminal activities, such as the black market, money laundering and others. as well as hackers who use Cryptocurrency as their favorite tool for hacking activities.

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