Cryptocurrency
Cryptocurrency is popularly known as the future currency model, which is available out and out in digitized format. Using cryptocurrency one can make the transaction entirely in digitized format without involving any physical activities. The USP of cryptocurrency is it is highly organized yet it is also decentralized system which means it is not controlled by any government or public body and it is highly accessible by any individual for transaction.
Cryptography Algorithms
To make you understand the concept in a much simpler way the currency which is need to be transacted is shielded with cryptography algorithms. Cryptography is all about sending a message in a highly secured way from one user to another user using encryption and decryption process.
Working
Public key
For example a message is converted into codes using public key and it is transacted to the node as a cipher text, the node sends the cipher text with respective private key. The proper user will receive the cipher text and read the message by using the uniquely generated private key.
It has been almost 10 years since the concept got evolved and lot of Cryptocurrencies have been evolved and one such established and successful cryptocurrency is bitcoin. Apart from bitcoin there are lot of other Cryptocurrencies have evolved and functions of each cryptocurrency type varies.Say if two individuals undergo cryptocurrency transaction in a peer to peer model first the currency value and total amount to be transacted is recorded, then according to the type of cryptocurrency used the total amount value will be changed.For example the value of US$12,400 is equal to 1 bitcoin so an American need to transact US$ 25000 then it is considered as 2 bit-coins, these 2 bit-coins will be transacted to the node from the sender first in a highly secured way.These bit-coins are not normally transacted instead they are transacted through encryption process. This transaction of bit-coins is made possible only through block-chain.
Block chain
Block-chain is the technology involved in cryptocurrency monetary transaction which helps to deliver the amount in a highly secured manner. The role of data miners is determined here were they add each block to make an entire block-chain.
- For this data miners need to crack the cryptography puzzle within the stipulated time, the hardness level keep on increasing with increase in amount.
- Once the required amount of blocks were created in framing the block-chain the amount in the form of bit-coin is transferred from Peer A to node hub.
- Another important aspect to be noted in cryptocurrency is the maintenance of ledger where the transactional details happening between two peers will be recorded in every node as a result of transparency.
- Hackers cannot get into these nodes as it is protected by highly encrypted public key, after the node.
- HUB receives the transactional amount it verifies the receiver and send it to the Peer B.
- where Peer B gets the transacted amount by using authenticated private key.
Advantages
- En-composed of high level security
- Highly digitized which involves zero physical documentation
- Has a great future ahead
- Global reach
- Not controlled by single government or public institute
- Very less transactional fee
- 10 times faster transaction
- Gives an earning option for data miners
Recommended websites
- Coinbase.com
- Bitstamp.net
Exchange platform
- Bittrex.com
