What is Crypto Currency?
Millions of people around the world are now investing in the phenomena known as Crypto Currency. From Australia to the USA, from China to Russia, from South Africa to India, millions around the globe have become embroiled in the trading and mining of Crypto Currency.
We’ll define both mining and trading later. First up though, the question is, what is Crypto Currency?
Crypto Currency is basically an online currency. To understand this, let’s look at Bitcoin, the first of its kind. Now what separates Crypto Currency from other more centralized forms of currencies spent online by banks?
For this, you need to realize that to make digital payments work, you need a payment network with accounts, balances, and transaction. However, the issue with money online is that you can accidentally spend it twice, and a bank has to prevent an error like that. Double spending would mean a person could spend more money than he has and this would put a bank out of pocket. To do this, a central authority (The Bank) checks every transaction and ensures that no money is able to be spent twice
Difference between Crypto Currency and Traditional Currencies
Here in lies the key difference. In this form of decentralized currency, every single entity of the network has to do this job of double checking. If even one is wrong, then the whole network will fall down. Yet in over 10 years, not one time has there ever been a mistake.
This is because Bitcoins and any other digital currency (Or even physical currency for that matter) are basically a list of records in a database that list the value of currency. That’s all they are, that’s the entire basis of currency. And if you can get decentralized nodes to check the database for you to ensure that no coin is spent twice, you’ve created a network that does the job for you.
Why does Crypto Currency Matter?
The main reason why Crypto Currency matters is because there’s a lot of potential in the currency. Like any new currency, there are a limited number of coins in it. However, here’s where the difference ends.
Not all Bitcoins have been distributed, and Bitcoins are not the only digital currency. What this means is that there’s potential for you to make money by discovering these coins by mining it, or by trading coins.
Mining is of greater profit in the longer run, while trading can lead to lower returns quicker.
Crypto Currency is the future of Technology. You can either resist it, or you can embrace it and make some profit while you’re at it. The potential of this relatively new technology is immense. With the right guidance, you can make a huge profit of this technology.