Like any other currency, Cryptocurrency is the digital medium of exchange. The first cryptocurrency was introduced back in 2009 by Satoshi Nakamoto.
The technology used in the exchange of the cryptocurrency is as based on Cryptography. Cryptography is used to control the creation of new coin and secure the transaction made by users, Further Cryptography is based on block chain technology introduce by Satoshi Nakamoto.
Including Bitcoin there are loads of cryptocurrencies in the digital and world.
In Other words “Cryptocurrency is the form of 100% digital money, it has no physical form and will not have it, it was created to live on the web, and more than 80% of the world’s population has access to this currency”.
A way of interacting economically as we have it in the physical world.
Unlike any other currency in the world where bank of the countries decides the price/rate of the currency and regulate it, No one decides the price or regulate the Cryptocurrency which means they are fully Decentralised.
Each cryptocurrency is linked to each other as they are one of two protocols (Proof of work or Proof of stake) made by Satoshi Nakamoto.
Unlike in the physical world the currency is regulated and made by several banks and there is no limit of making physical money, The digital money (Cryptocurrency) can only be in circulation till a specific supply.
What is Blockchain Technology?
This is the Technology Of Future made by a group of inventors known Pseudonym. “The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”- Don & Aleps tapscot.
Major use of blockchain is to confirm the transaction or sharing of the data to various nodes digitally.
In simple words “Blockchain is the decentralised network in which the data is shared among different nodes (computers) which verify the transaction which can be cryptocurrency or a document after verification the transaction is combined with other transactions to create a new block of ledger the new block is added to the address block and then the transaction is compete.”
What is Mining?
Mining is a process of digging Cryptocurrency and confirming transactions made by users in the cryptocurrency world.
As we got to know that this is a decentralised currency so every one can participate in mining if he/she have a access to a good internet connection and particular hardware of mining.
A person can earn from Mining in two different ways
- The fees given by the Sender.
- The reward given by the Blockchain in the form of the same cryptocurrency.
But unfortunately de to the certain algorithm made by Satoshi Nakamoto the reward to the miners decreases by half after every 210,000 block which is rughly 4 years.
Which means when the Bitcoin was founded in 2009the reward was 50 per block, Then in 2014 the reward per block was 25 and so on.
The tools used for mining are High performing GPU’s and motherboards.
What is Cryptocurrency Hash?
If you want to produce more Cryptocurrency as a reward you need more hash power for that, Therefore hash is directly proportional to reward gained by you.
Every time a miner produces a reward at the same time he produces a hash, Then a hash algorithm convert this huge amount of data in a single length hash. 1kH/s is mining at a rate of 1,000 hashes a second, 1MH/s is a million hashes per second and a GH/s is one billion hashes per second.
Market Capitaliztion of Cryptocurrencies.
Currently Bitcoin is the largest Cryptocurrency in the world in both market capatalization and acceptance. The market capital Bitcoin is nearly to whooping 73 Billion Dollars while writing.
Then the second place is taken by Ethereum which grew rapidly in the first quarter of 2017 from $10/coin to $400 per coin. The reason behind the rapid growth was ICO’s which started accepting ETH for there token sales.
Current market capital of Ethereum is 29 Billion dollars which is 200% increased value from December 2016.
Is Cryptocurrency Legal?
Actually the real answer is
Cryptocurrency is legal in 90% of the world and is taxable as an asset because 70% of the users of crypto currency are investors.
Which means that they dont buy Cryptocurrency as a currency but they use it as a investment purpose, which means asset.
So if you pay tax for something this means that thing is legal.