:What are digital currencies?

Cryptocurrencies are virtual or digital currencies designed to act as a medium of exchange. It uses cryptography to secure and verify transactions as well as to control the creation of new units of any given digital currency. Essentially, cryptocurrencies are limited entries in a database that no one can change unless specific conditions are met.

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There were many attempts to create a digital currency during the technology boom of the 1990s, with systems such as Flows, Beans and DigiCash coming to the market but ultimately failing. There were many, many reasons for its failure, such as fraud, financial problems, and even friction between company employees and their bosses.

It is worth noting that all of these systems used a trusted third-party approach, which means that the companies behind them have verified and facilitated transactions. Because of the failures of these companies, creating a digital cash system was seen as a hopeless case for a long time.

Then, in early 2009, an anonymous programmer or group of programmers under the pseudonym Satoshi Nakamoto introduced Bitcoin. Satoshi described it as a “peer electronic cash system.” It is a completely decentralized system, meaning there are no servers involved and no central controlling authority. .