Cryptocurrency Trading Has Renewed Confidence in the Use of Digital Currencies like Bitcoin

Investors in cryptocurrencies such as Bitcoin are happy to know that it is currently valued at just over $4,000 as it has seen an increase of 1.84%. If news like this does not inspire potential investors from making a move to putting their monies into one of the best cryptocurrency exchanges on Blogspot then I don’t know what else will.

Another bit of new is that Bitcoin booked the 5th win in a row among other crypto coins. Even Litecoin has doubled, which instill even more confidence in potential traders to learn more about this ultimate way of using your money.

How does the Merriam Webster dictionary define cryptocurrency to USD?

They see it as any currency that exists digitally only. In turn, it utilizes a decentralized system for recording the transactions as well as manage the issuing of new units without the need for a regulating or central issuing authority to be involved. It also relies on cryptography to avoid fraudulent and counterfeit transactions.

To put it another way;

Digital currencies like Ethos make use of cryptography to verify and secure transactions while it would simultaneously control the creation of new units. In essence, crypto is regarded as limited entries within a database that others cannot change until a specific condition is fulfilled.

Why Everyone Should Have More Confidence in Cryptocurrency Like Ethereum and Other Altcoins

Just a couple of days ago, the South Korean Giant – Samsung, announced that their latest smartphone addition, the Galaxy S10 will feature secure storage that is backed by robust hardware to make provision for blockchain mobile services. The phones are even primed with Blockchain tutorials to assist users to gain a deeper understanding of the new way to move money through their built-in wallet known as “Samsung Blockchain Keystore.”

Going Back in Time – Crypto’s History

There have been various attempts to create a robust digital currency since the 1990s when people say the rise and fall of systems like DigiCash, Beenz, and Flooz. The different reasons that contributed to such misdemeanors were attributed to financial problems, fraud, and friction between bosses and their employees.

Somehow, all the systems made use of what was known as a trusted 3rd party approach, which meant the companies behind them facilitated and verified the various transactions. Because of the failure of these firms, the creation of a trusted digital system was regarded as a lost cause for a long while.

That was until the year 2009, when under the direction of an alias known as Satoshi Nakamoto, Bitcoin saw the light of day. It was defined as an electronic peer-to-peer system that was fully decentralized without the intervention of any servers or central authorities.

One of the main issues faced in the past had to be overcome, which involved double-spending. No one wanted to lose additional funds by spending the same amount twice in a row. What they needed was a traditional way that utilized a 3rd party or central server to keep records of all transactions and balances. What they didn’t need was a central authority that maintained control over everybody’s finances.

This is where the decentralized network in the form of Bitcoin came to the rescue where several participants were needed to carry out this function. They would do this through Blockchain, which serves as a public ledger to keep account of all transactions that were run within the network and made available to everyone involved.

What happens around every transaction is that encrypted files are transferred that consist of the recipient’s and sender’s wallet addresses (public keys) and the amount of the coins. The sender would sign off the transaction using his or her private key. All this jargon is contained in one word – cryptography. In time, the transaction would be broadcasted for all to see, but it must be confirmed first.

Who would confirm the transactions within the network, and how safe is it?

No doubt, this question crosses many inquiring minds. There is no need to be concerned. Only miners within the network are allowed to confirm transactions through solving a cryptographic puzzle. They would mark the relevant transactions entering the system as legitimate. Soon after, nodes within the network would add these to the database. Once confirmed the transactions cannot be reversed and the miner would receive their reward.

It is reassuring to know that the consensus-keeping process is secured with strong cryptography.

Cryptocurrency Exchange: Looking Beyond the Hype

The reason many a cryptocurrency trading exists is that they are looking beyond the hype. There isn’t any particular problem raised right now that cannot be successfully solved. People seem to overlook the fact that cryptocurrencies emerged from a culture of cryptoanarchy, not from governments or economists.

Even though transactions, surrounding trading on various crypto trading platforms tend to be slow and expensive, difficult to scale, and prone to congestion, the ledger technologies associated with it holds a lot of promise.

Our Existing Payment and Monetary System

The tried and trusted way to instill confidence in money is through an independent centralized bank. This would imply agreed upon goals that involve financial objectives and clear monetary policies, democratic accountability, and administrative independence to secure broad-based support from a political perspective. Independent central banks managed to achieve their purpose of safeguarding our society’s political and economic interest with what is considered to be a stable currency. As a result, money can be defined as something indispensable that is backed by an institution that enjoys the trust of the public at large.

Almost all our modern-day economies provide money through one or the other joint public and private venture that exists between private and central banks, where the latter would be at the system’s core.

What is more, electronic deposits would be at the order of the day and form part of the primary means of payment between various users. Central bank reserves serve as payment between different banks. Through their two-tied payment processes, trust is created through accountable and independent central banks. They back their reserves utilizing asset holdings. Trust in bank deposits stems from supervision, regulation, and insurance schemes, which emanates from the state.

Further to this, the central banks ensure any payments made run smoothly while they see to it that the reserves supplied respond according to shifting demand.

Cryptocurrency, on the other hand, is seen as an elusive promise of decentralized trust.

Do cryptocurrencies and the exchange that accompany them deliver on their promises? Will they just turn out to be short-lived curiosities in the end? We need to gain an understanding of the associated economic limitations to answer this question better.

Would You Consider Cryptocurrencies as New Petals?

Crypto coins want to be respected as a new type of currency and promise to hold up to its vision of providing value and stability through technology. They are made up of three different elements.

The first of these would be a host of rules in that specific computer codes would be in place to indicate how users need to transact.

Secondly, they would utilize a secure ledger to record and store transactions.

Thirdly, decentralized networks that are in place to update read and store the ledger of transactions that follow a set protocol of rules.

By following these elements, they claim that cryptocurrencies are not subject to the so-called misguided incentives offered by sovereigns and banks.

Regarding the money flower taxonomy, cryptocurrencies have put together three main features:

  1. The first of these take on a digital format that aspired to serve as a convenient way to make payments that rely on cryptography to avoid fraudulent transactions from taking place and counterfeiting.
  2. Second of all, even though it was set up privately, no one is held liable in that the currencies cannot be redeemed. The value they represent is derived from the mere fact that others would continue to accept it as a form of payment. This way, it is similar to commodity monies.
  3. Third of all, it makes provision for a digital peer-to-peer exchange.

How Does Cryptocurrency Compare to Private Digital Monies?

As opposed to private digital money in the form of bank deposits, cryptocurrencies make use of the digital peer-to-peer exchange. Without a doubt, digital bank accounts have been around for many years.

Did you know that privately used “virtual currencies” have been used extensively during multiplayer games such as World of Warcraft, which predated cryptocurrencies by more than ten years?

However, crypto transfers take place within a decentralized setting without any central party being needed to make the exchange happen.

Because of this, digital currencies such as Bitcoin can confidently offer a convenient payment method that is solely based on digital technology, which is a model we can trust.