Introduction to CryptocurrencyWhat is Cryptocurrency?
Cryptocurrency is a digital or virtual form of currency that uses cryptography for security. Unlike traditional currencies issued by governments (like the US Dollar or Euro), cryptocurrencies operate on technology called blockchain, which is a decentralized network of computers that records transactions and ensures their validity. This decentralization means that no single entity, such as a bank or government, has control over the entire network.
History of Cryptocurrency
The concept of digital currency has been around since the late 20th century, but it wasn't until the introduction of Bitcoin in 2009 that cryptocurrency as we know it today came into existence. Bitcoin was created by an anonymous person (or group) known as Satoshi Nakamoto, who published a white paper titled "Bitcoin: A Peer-to-Peer Electronic Cash System." This paper detailed how Bitcoin would use a decentralized ledger system (blockchain) to facilitate transactions without the need for a trusted third party.
Difference Between Cryptocurrency and Fiat Currency
Centralization vs. Decentralization:
Fiat Currency: Issued and regulated by central authorities such as governments and central banks.Cryptocurrency: Typically decentralized, relying on a distributed network of nodes to verify transactions and maintain the blockchain.
Physical vs. Digital:
Fiat Currency: Exists in physical forms (coins and banknotes) as well as digital representations.Cryptocurrency: Exists purely in digital form and is stored in digital wallets.
Supply Control:
Fiat Currency: Central banks can print more money, which can lead to inflation.Cryptocurrency: Many have a fixed supply (e.g., Bitcoin has a maximum supply of 21 million coins), which can create scarcity and potentially increase value.
Transaction Speed and Cost:
Fiat Currency: Bank transfers can take several days and may involve high fees, especially for international
