Cryptography brings you secure (or “hidden”) communication. A cryptic crossword does not offer straightforward clues but each question is a word puzzle in itself. Now the threat to all currencies comes from forgery and counterfeiting but with a cryptocurrency we see the introduction of a digital or virtual currency which employs cryptography as its security and for that reason it is almost impossible to issue counterfeits.
The fact that identifies all cryptocurrencies and makes them so attractive to certain kinds of people is that they are the most independent of currencies because they are not issued by any government and are not in thrall to any central bank, national or regional. They can’t therefore be influenced or manipulated for political reasons.
Transactions carried out in cryptocurrencies are of course highly anonymous which makes them suspicious to those policing the currency world as they are probe to be employed for the purposes of both money laundering and tax evasion. The first and best known cryptocurrency is of course Bitcoin which was introduced to the world in 2009. The market value of Bitcoin holders is now in excess of $4 billion with around 15 billion bitcoins in circulation.
Success always breeds copyists and competitors and several other cryptocurrencies have come on to the market including Litecoin, Namecoin and PPCoin.
Among the benefits that cryptocurrencies bring is the ease with which funds can be transferred between two parties in a transaction. These transfers involve very small processing fees and that makes them especially attractive at a time when banks and other financial institutions make such high charges. Bitcoin’s blockchain stores online all the transactions that have ever been conducted which can be copied across all computers running their software. This in turn may bring uses for crowdfunding and also online voting and major players see a potential in cryptocurrencies for lowering the cost of transactions by providing greater efficiency in payment processing.
The downside is the nature of such currencies being virtual and in lacking a central repository, it leaves them liable to being totally wiped out by a computer crash, unless there is a backup copy available. Also prices are based on supply and demand which allows for wide fluctuations in value, which can be seen on platforms such as bitcoin up app official.
Being virtual does not mean that these currencies are not likely to be hacked. There have been more than 40 recorded thefts from Bitcoins, one of which was for more than $1 million.
Interested? So now you want to find out how you can buy and use cryptocurrencies. You aren’t of course confined to Bitcoin, even though it is the most valuable and best known, so it would be worth exploring the alternatives.
You will receive a digital key which will link you with the currency which you will use to access and validate and approve transactions. Your key needs to be kept in a cryptocurrency wallet for safety purposes and you will find a wide variety of such wallets to choose from: desktop, online, mobile and paper.
Cryptocurrencies have arrived and are here to stay!
