“As you people may aware that the Satoshi Nakamoto (unknown inventor) invented the first cryptocurrency “Bitcoin” late in 2008 but less number of people know that it was the precursor of “Bit gold” where Nick Szabo worked on it in between 1998 to 2005.
Among the cryptocurrency integrity and safety of records is managed by community/individuals called as Miners. Miners is the member who is using the computers to help in validating and timestamp transaction adding them to records as per timestamp schemes.”
Introduction:
The article will cover basic understanding of cryptocurrency. After reading the article, you will know more than most of common humans.Today Cryptocurrency is the global trend but last year, it was hard time to find banks, companies and governments sectors that not aware of it & even not researched about it. Now its value known to most of the Peoples, Businesses, Government, Banks, Scientist and Developers etc. & they were showing interest to get in to it.Following are the points, which will help to understand about the cryptocurrency.
1. What is Cryptocurrency?
It is the Future of Digital Currency asset invented to exchange cryptography to secure a transaction and to control creation of the currency.
The
Entire Cryptocurrency collectively gathered and invented decentralized
cryptocurrency framework. Like centralized company, governments as well as banking
sector, control the supply of currency or demanding. Unlike in decentralized
cryptocurrency the companies, governments should not produce new units &
not authorize to any firms to produce it.
2. Process of coin creation & How Transaction
verified
Let
us understand the mechanism & process of coin creation. Bitcoin creation
process consist of network peers, which help to mine the currencies. Each peers
has complete record history of every transactions, this called as balance of
account.
How
Transaction verified
Suppose person A gives x number
of bitcoins to person B & it is signed by person A`s private key. The
mechanism is public key cryptography. Post signed, a transaction is broadcasted
and sent from one peer to other peers, called as P2P technology.Once
specific amount of time transaction get confirmed, then Whole Network knows it. Confirmation
is very critical part of cryptocurrencies; you can say that Cryptocurrency is
all about CONFIRMATION.
As
long as transaction is unconfirmed, it is in pending and forged state. Once it
get confirmed, it is no longer forgeable and not reversed. Miners is the main part of
cryptocurrency mining. It is their job in cryptocurrency network. He take
transaction, stamp it as legit and spread them in network. Post confirmation
from miners, everyone has to add it in Database, as it is become a part of
BLOCKCHAIN.
3.
Need to invent Cryptocurrency
As
we know unknown person Satoshi Nakamoto invented cryptocurrency, a new company
producing new form of digital money – BITCOIN was born. As we know, centralized
Authority does not control it & miners are playing important role in
creation of cryptocurrency in mining day to day.
Big
Web sites like WordPress, Reddit accepts the currency such as BITCOIN as a
currency. The
Cryptocurrency has its own value and can be exchanged internally among other
currencies like Dogecoin, Litecoin and Altocoin etc. if we look at the dollar,
people buy foods using dollar but what if everyone stop accepting Dollar as
exchange medium, it will be worthless. Here we can exchange dollar with
cryptocurrency. If more number of businesses and people start, accepting &
using it value become high and it will be more stable. 4.
Cryptocurrency vs Physical Currency
The
main an important difference and making cryptocurrency better is that there is
no central authority like banks, governments, businesses & peoples to
control it.
1.
Cryptocurrency Properties:
The
following are the important part of cryptocurrency framework. Let us understand
it one by one.
a. Transactional:
i. Fast &
Global: As soon as user initiate a transaction, it broadcasted instantly in
the network & confirmed within minutes. Since a transaction, happen
globally irrespective of physical location. It does not matter from which
location you performed it.
ii. Permissionless:
you do not need permission before using it. It is a piece of software application,
which user can download free. Post installation you are able to perform the
send receive transaction.
iii. Secure:
Cryptocurrency funds are locked in public key cryptography system. Owner of the
cryptocurrency with private key can able to send it. The strong cryptocurrency
algorithm and length of currency makes it unbreakable.
iv. Pseudonymous:
A transaction or accounts are not physically connected to real world. Every
user receive cryptocurrency on a unique address called as Wallet.
v. Irreversible:
once a transaction confirmed, it cannot be reversed. No one has rights to roll
it back, nor government, not individual people, nor business, no ONE. Once you
successfully complete the transaction and send to any of account even if he is spammer/hacker,
it can’t be reversed. There is no safety yet.
b.
Monetary:
i.
No debt but Bearer: Cryptocurrencies do not
represent debts. As we know physical money is limited & cannot be
changeable by Government, institutions etc but cryptocurrencies manipulate the
monetary supply by taking away control central banks take on inflammation and
deflation.
ii.
Controlled Supply: All Cryptocurrencies control the
supply of the token. That mean the monetary supply of cryptocurrency of the
future can be roughly calculated today. 2.
New Era of Currency – Cryptocurrency
Cryptocurrency
is the form of money, which promises to preserve and increase its value over a
period.Exchanges
like Poloniex, OKcoin & shapeshift plays with hundreds of cryptocurrencies
& trade daily. a.
Point-To-Point:
P2P transfer happen, when one user sends currency to other user using
pre-loaded app in mobile or using browser to initiate authenticate and transfer
funds using computer systems.
b.
In Person:
In-Person transfer occur when user is going to buy at store where the seller
allow a transaction of cryptocurrency using mobile device.
c.
Remote:
Remote transfer allow user to use cryptocurrency to purchase the foods using
mobile application but seller and buyer are not in-person so to validate the
transaction status the buying is not immediately deliver the foods (ecommerce
Sites). 3.
Why to Buy Cryptocurrency?
There
are multiple reasons to buy cryptocurrency but most important reason is; it is
easy to manage to have many different accounts.
Using
it, you may be safe from cyber criminals as you do not need to put personal information,
which is not mandatory, you can use nickname to register & for buying
cryptocurrency.Second
main reason is that technology is changing and become a strong and it is really
require being with changing technology, which will be future of cryptocurrency. 1.
Wallet
A
“wallet” is like a bank account, which allow user to receive, deposit and then
send to others user who hold the wallet.
There
are two main types of wallets.
Software
Wallet: A software wallet is application that you install on computer or
mobile device. You can control the security of your coins, but they can
sometimes not easy to install and maintain.
Web
Wallet: A web wallet is one that is hosted by a third party companies.
These are often much easier to use, but user have to trust the provider to
maintain high levels of security to protect your coins from being stolen or
hacked.
These
are main wallets, which I recommend for beginners: Coinbase (https://goo.gl/Pg8X5B), Blockchain.info etc.Indian
Wallet – ZebPay (https://goo.gl/ATV5XA), Unocoin (https://goo.gl/oTuvPp), Coinsecure (https://goo.gl/Jz6drZ) etc. Coinbase:It
is a Web Wallet, simple to use and used by number of users due to features
where he can send-receive coins using email & buy-sell from Coinbase. Coinbase
is one of the large cryptocurrency trading company, which never suffered and
breach or hacked till date. Blockchain: Now days it is very easy to get
bitcoin wallet, blockchain rings the platform where user can sign up with basic
information and get bitcoin wallet approved. It
is same like Coinbase, user can send-receive cryptocurrency, simple user interface,
Secure mobile app access also provide support to bitcoin community.
1.
What is Hashpower?
Hash (rate): It is output of a Hash
Function. A hash is long and complex string (hexadecimal). As it is relate to Bitcoin, hash rate is a
speed at which systems is computing the operation in bitcoin. While mining
higher the hash rate become the chances of getting next block & receiving
the daily wages. Example
of a hash: 85fe8f200fbb889c60809624864597890d4c63735b7fe5bddac821de96a52b5c Mining
capacity is measured based on how much number of attempt it perform within period
in order to invent new block. To search for new block miner use sha-256 hashing
algorithm function. Let us learn basic points used in hashpower. Hash rate Units:· One kH/s : One thousand hashes/second· One MH/s: One million hashes/second.· One GH/s: One billion hashes/second.· One TH/s: One trillion hashes/second.· One PH/s: One quadrillion hashes/second.· One EH/s: One quintillion hashes/second. Conversions:·
1 MH/s = 1,000 kH/s·
1 GH/s = 1,000 MH/s = 1,000,000 kH/s·
1 TH/s = 1,000 GH/s = 1,000,000 MH/s =
1,000,000,000 kH/s·
and so forth 2.
Ways To Earn Cryptocurrency:
Like
physical currency, we can earn cryptocurrency as well. There are two basic Methods
you can earn cryptocurrency with investment or without investment.
PTC
is one of best way of earning cryptocurrency without investment.
Mining
: Mining is the process of creation of new coins. With the help of Miner
contribution and his computer power, new block of hash is invented and add it
to blockchain to get it acknowledgment to everyone & start to search for
next blocks. A block is a file consist of record of recently earned bitcoins.
As you know, mining process is dependent on hardware with power supply also,
it is very expensive process, so most of miners join it and form a mining pool.If you want to earn bitcoin by real mining,
you can sign up using the
link: https://www.genesis-mining.com/a/1323171
use Affiliate Code: vPlQYR
to get 3% discount.
Completing
Tasks on web sites:You can call it as PTC: Pay-to-Click. This is very easy and fast bitcoin
earning resource but it need more time to earn, as user has to click on
advertisement link to earn bitcoin. The concept is very simple, those who want traffic on their Web site,
Blog, YouTube channel they place add on sites & pay. Same side people like
us click on add and earn bitcoin placed against the advertisement. Some of sites offer to complete the survey, Play the Games, Lottery &
pay the bitcoin. You can earn by watching Videos, completing maths quiz as well
as by listening music as well.
Now a days individual and multiple businesses offering bitcoins against
the advertise which they place. a) Adbtc.top: The site allow user to place
advertisement as well as those who want to earn send to them to click and earn.
Referral program is also one of feature of the site where you get benefits of %
when they earn. Sign up: https://goo.gl/WFWDur7.5% from you referral surfing earnings & advertisement spending is
each.b) Btcclicks.com: They claim “Earn up to 0.00097
mBTC per click and 80% referral/affiliate commission!” sign up: https://goo.gl/owCNaRc) Many more site offers free faucets every 5 min,
hours join me: https://goo.gl/NQooXyd)
There are some sites, which provide Faucet to
visit the sites. Only user have to fill the captcha and claim the faucet.Faucet – it is the reward systems offered by web owner to visit the
website. By filling the captcha or completing the task user can claim it and earn. From Gambling
- not suitable for everyone: frankly speaking, I am not interested in gambling,
it is really a risky Game. If you are lucky, enough then you can earn like in
heaven but if luck is not with you, you may lose it. As it is one of way of earning
so, I have mentioned here. Being Tipped:
as name suggest, when you earn coins through tips, its more you accepted it in
the form of bitcoin. For this you need bitcoin wallet with QR code so
interested people can donate/tip you a bitcoins. There are various places where
you can get tips like Shops, Website/Blog by putting QR code so people can
tipped you for great job, get the tips as a bitcoin from customers to waiter
etc.
Through
Trading: many peoples have mind of gambling and trading is same but there
is fundamental difference, in gambling there is chances of winning/losing but
when user trade, it gets in to much more complex phase.The easiest & safest way is to buy an asset at cheap rates from one
entity and sell it with profit to another entity when selling price is high. It’s
all about the strategy you use.
From
interest payments: suppose if you have bitcoin with you which you are planning
to invest so you will get interest. This is very easy earning strategy when
user invest on trusted sites like bitconnect.co. By lending them out.o
Lend Directly: if you believe/trust on someone
and agreed to returns part of mutual agreement then you can directly lend coins
on his wallet for fixed time and gets interest daily/weekly/monthly.o
Peer-to-peer lending: here most of borrower
request for huge funds, user like us help them by investing small portion of
currency in their funds. Before investing, you should remember thumb rule: the
Web Site & Borrower should be trusted.
By
accepting cryptocurrency as a means of payment: The best and easiest way of
earning bitcoin is setup a small business (if you do not have) and start to
accept cryptocurrency as exchange of medium. For these you require bitcoin
wallet 1. Popular Cryptocurrencies: multiple
cryptocurrencies available in digital market such as bitcoin, Ethereum,
Litecoin, STEEM, Dogecoin, Ripple, Dash, Golem, BitShares, CureCoin, XEM,
Monero, Zcash, Factom, Bytecoin, Bitcoin Cash, Lisk, MaidSafeCoin, USD,
Gridcoin, Ethereum Classic etc.
Here
I will introduce you with famous cryptocurrencies. a)
Bitcoin:
Today bitcoin is the most popular cryptocurrency accepted worldwide which is
having high current rate 1 BTC = $4388 invented by unknown inventor Satoshi
Nakamoto late in 2008. b)
Ethereum:
It is also a high value currency but now days we have seen multiple up down in
the rates. current rate: 1 ETH = $336.94 c)
Litecoin:
It was invented in 2011. It can be mined and used to buy goods and services. Current
rate 1 LTC = $57.63 d)
Dogecoin:
It is one of the cryptocurrency widely used now a day for donation and buying
goods/services. Researchers confirmed the value of the Dogecoin would be UP in
future.
Current rate 1 DOGE = $ 0.001756 e)
Monero:
if you more focus on privacy then Monero is for you. It is most secure
currency, which was invented. It uses ring signature technology to perform the
payment secure and untraceable.Current
rate: 1 Monero = $133.09 1.
How To Open Account For Cryptocurrency:
Yes,
it is very easy to register on the site which currency you want to earn. Like
for bitcoin you can sign up for Coinbase, blockchain etc.
Once
user enter the basic information asked in sign up form, profile get create and
activated. Post to that, he can start sending and receiving the cryptocurrency
but some of Wallets first verifies the user personal & banking information.
Once details get validate then he gets the access to wallet.
For
Indians: ZebPay, Unocoin follow the similar process. Once user complete the PI
and bank information, his profile get active then he can start
withdraw-deposit, buy-sell process. 1.
Issues with Cryptocurrencies
There are things, which you need to keep in mind while dealing with cryptocurrencies. a.
Tax:
User
need to think about the TAX. It varies from country to country, region to
region. Once you convert it to the form of local currency and deposit it into
banks then you must be accountable for source of income and obviously, you have
to pay tax if it is applicable as per Income Tax Law.
b.
KYC:
Know
Your Customer always based on region. There is always restriction of managing
the money of people who is not belongs to the specific country. KYC is always
there to prevent the criminal activities. If you want to convert the
cryptocurrency in to physical currency like local currency and deposit, it into
bank for withdrawal then your anonymity will not work.
14.
Advantage & Disadvantage of Cryptocurrency
Advantage
of Cryptocurrency
a.
Low
Transaction Fees: Cryptocurrency framework is designed such a way that if
user willing to transfer the currency within individual or business less
transaction fees is charged.b.
Globally
accepted: as cryptocurrency globally reached, there is always support
available and known to every entity.c.
Fraud
proof: User do not have to worry about the losing the money, they will not
fear about the identity theft. As it is irreversible you do not have to charge
back that always possible in case of PayPal, master card etc. Disadvantage
of Cryptocurrency
Little investment to manage: user
require some level of knowledge to manage the crypto payment system. At initial
level you require expert advice until you know everything and able to manage
all the things to avoid the loss. 2.
Should I need to invest
Now
days, Cryptocurrency is alternative market in digital world where people from
the world use it and gets lot of money out of them. If we search on YouTube,
you will get lot many videos with proof.
Before
investing the money you should inquire about the current rate, you can refer
Coinbase, blockchain to know more. If
you are looking to invest, I suggest to start from low amount, learn-study it. Once
you are sure, confidence and believe then proceed further to invest more.
Always remember, cryptocurrency do not have centralized authority to control
the price. Also while setting up wallet be sure to know the entire thing about
it. Check the review & make sure the wallet is secure. 3. Is it Legal? As per Wikipedia, The legality status changing region by
region, country by country & it is undefined in many of state. Regulatory laws
affect the use of cryptocurrency. Some of countries explicitly allowed its use
and trade, other have restricted/banned.Countries declared the use of cryptocurrency is illegal:
Bolivia, Ecuador, Kyrgyzstan, Saudi Arabia & Bangladesh.For more info: https://en.wikipedia.org/wiki/Legality_of_bitcoin_by_country_or_territory 4.
Short Glossary:
BTC/Coin is the acronym for Bitcoin.
A Satoshi is the smallest part of Bitcoin. 100,000,000 Satoshi = 1.00000000 ฿
Transaction is the process of sending bitcoin from one wallet to another wallet, called as Transaction.
Transaction fee: as we know, whenever individual perform the transaction there is backend team who confirm the transaction and approve it. They won’t do this free. This is the reason whenever we do transaction a tiny fees charged, called as transaction fee.
Exchange is a platform, which enable user access to change once currency in to another currency immediately.
Cold wallet refers to one of the method to store the bitcoins offline, safe and securely.
Hot wallet is the reverse of a cold wallet. It is located on computer systems, which connected to the internet. Most of people keep bitcoin in Hot Wallet to protect ourselves from hackers.
Note: Very soon, I will come up with Part 2 and try to cover most of the points in the article.
Using
it, you may be safe from cyber criminals as you do not need to put personal information,
which is not mandatory, you can use nickname to register & for buying
cryptocurrency.Second
main reason is that technology is changing and become a strong and it is really
require being with changing technology, which will be future of cryptocurrency.
Once
user enter the basic information asked in sign up form, profile get create and
activated. Post to that, he can start sending and receiving the cryptocurrency
but some of Wallets first verifies the user personal & banking information.
Once details get validate then he gets the access to wallet.
User
need to think about the TAX. It varies from country to country, region to
region. Once you convert it to the form of local currency and deposit it into
banks then you must be accountable for source of income and obviously, you have
to pay tax if it is applicable as per Income Tax Law.
Know
Your Customer always based on region. There is always restriction of managing
the money of people who is not belongs to the specific country. KYC is always
there to prevent the criminal activities. If you want to convert the
cryptocurrency in to physical currency like local currency and deposit, it into
bank for withdrawal then your anonymity will not work.
Advantage
of Cryptocurrency
No comments:
Post a Comment