1. Definition of cryptocurrency (electronic money).
Cryptocurrency is an electronic currency with many different names such as digital money or pre-coding. This money is based on the use of the most modern encryption techniques and computer algorithms. Thanks to the complexity of this high-tech coding system, the structure of the system can not be broken down so that the currency will not be tampered with or cheated like other conventional currencies. In addition, this technology helps hide the real details of transactions, helping to protect the identity of the owner of the cryptocurrency.
At present, there are many trading platforms to support the trading of cryptocurrency (money electrons) with other currencies in the world such as USD, EUR, ... and other types of cryptocurrency will also be available. a separate exchange rate for these popular currencies respectively.
Most of these Cryptocurrency types have a finite supply, since the extraction of cryptocurrency requires a lot of time and manpower and is now becoming more and more difficult until the entire supply It was mined by miners.
All other normal currencies (such as the US dollar, British pound, Japanese yen, ...) are subject to government, central bank or other governmental organization. Take control of the value of a currency, for example, through the power of monetary printing. Unlike these, electronic money is not controlled by any organization or individual thanks to its decentralized operation system. Cryptocurrency users are also the ones who manage the supply and value of this currency through extremely complex encryption protocols. So, once you have owned the cryptocurrency money, no government or organization can freeze your account like a bank account. However, you will also be subject to certain risks such as the liquidity of currency cryptocurrency or fluctuations in the value of this currency.
2. History of cryptocurrency (electronic money).
The first Cryptocurrency was created by Bitcoin by a young talent named Satoshi Nakamoto in 2009. So far, personal information about the creator of Bitcoin is still unknown to the expert. world. This electronic currency is based on the use of SHA-256 - a type of encryption function created by the US National Security Agency. And the appearance of Bitcoin made the premise for the birth of other types of money later.
In April 2011, another crypto-currency Namecoin was created that marks the first step in the decentralization of the DNS (Doman Name System), which has made censorship on the Internet more difficult. than.
Soon after, in October of 2011, Litecoin was officially released and became the first electronic money to successfully use the cryptographic function instead of the SHA-256. Thanks to this success, Litecoin can be exploited more easily without having to buy machines like ASIC to exploit Bitcoin. Litecoin quickly gained the recognition from financial investors around the world and reached a market capitalization of $ 1 billion.
Some other types of electronic money are equally attracted to Ripplecoin and IOTA with new enhancements in encryption technology.
3. How cryptocurrency works (electronic money).
The above diagram describes how cryptocurrency works and uses blockchain technology.
Cryptocurrency works on an open and public data source with a very complex coding system operated by blockchain technology. And the supply of cryptocurrency is based on the exploitation of the diggers.
The value of a cryptocurrency as well as the value of a normal currency, ie if you own a coin of cryptocurrency is the same as if you had a US dollar or a pound.