In almost all media platforms, cryptocurrency is making a buzz particularly these days since it was invented. Some people say it is good and some do not agree nor believe in it. But what is cryptocurrency?
Cryptocurrency: Defined
Cryptocurrency is a portmanteau of cryptography and currency. It refers to avirtual currencythat is protected by cryptographywhich is responsible for securing online transactions andinhibiting counterfeits. This digital money is deemed by its maker as the world’s future currency as it replaces its physical counterpartin buying products and services.What makes cryptocurrency promising is its special feature of not being controlled by a central authority which makes it resistant to government interference. For this same reason, it is also not supported by its opposers because it might disrupt the law and finance industry which holds the economy together. Aside from that, cryptocurrency has been facing a lot of criticisms since its creation because of its exchange rate volatility and cyber vulnerabilities which can be used for illegal activities. Despite these, the popularity of cryptocurrency skyrocketed because it made a lot of users become millionaires in the cyberworld because of its inflation-proof feature and transactional convenience.
How Does Crypto Industry Works
The mechanics of cryptocurrency is that it uses virtual “tokens” to make online transactions. All the payments are safeguarded by various encryption algorithms and cryptographic techniques such as elliptical curve encryption, public and private key pairs, and hashing functions. Since the launching of the first-ever cryptocurrency— Bitcoin—last 2009, a lot of crypto blockchains have emerged and one of these is the third generation cryptocurrency: Cardano.
Things You Do Not Know About Cardano
Cardano Blockchain is a third-generation, decentralized PoScryptocurrency platform which is created by Charles Hoskinson who is a co-founder of PoW blockchain Ethereum.Cardano is designed to address the underlying issues of PoW networks such as scalability, interoperability, and sustainability that are limited by energy consumption, growing cost, and slow transaction which are considered infrastructure burdens. Consequently, making Cardano a more efficient alternative to Ethereum. The digital currency of Cardano is called Ada which is derived from an English mathematician, Ada Lovelace, who is the first computer programmer in the 19th century.
Key Terms
- Elliptical curve encryption is used to secure public-key cryptography, which allows the crypto holders to receive cryptocurrencies from other users.
- Public and private key pairing refers to a unique cryptographic codethat facilitates transactions between parties.
- Hashing functions is a cryptographic tool used for securing the authentication process which is needed in ensuring data message integrity across any digital channels.
- Power-of-Work (PoW) is a method of acquiring cryptocurrency through miningwherein the user uses a computer to solve complex mathematical equations that can validate transaction blocks.
- Proof-of-Stake (PoS ) is another method of acquiring cryptocurrency which works more like a lottery. The more coins you hold for staking, the greater the chance your transaction will be validated.