Do You Know What Is Cryptocurrency?

People have indeed come a long way in terms of technological transitions. The evolution of technology has not only led to the establishment of machines but also facilitating trade through flexible cash flow. Thanks to the effort of financial technologists for creating a dynamic system of trade, unlike the era of barter trade or even relying on real money. The acknowledgment of technologists goes to people who initiated Cryptocurrency. A cryptocurrency is a form of virtual or digital currency that is protected by cryptography. In this case, cryptography refers to a strategy of protecting information that involves the communication of two people. The protection of information is achieved through the help of codes. Crypt means hidden, whereas “graphy” refers to a form of writing.

In short, Cryptocurrency is a digital asset that is designed to be used as a medium of exchange that using strong cryptography to ensure the security of financial transactions, control the creation of additional units, and verify the transfer of assets.

There are many types of Cryptocurrency like Bitcoin, Ethereum, XRP, and so on. Bitcoin is the best example of a reliable form of Cryptocurrency that has been in existence since 2009. It was created by Satoshi Nakamoto in 2008 while trying to invent a peer to peer electronic cash system. It is vital to understand how Cryptocurrencies like Bitcoin works in the digital era. The ability to gain knowledge on this topic will then address the validity of Cryptocurrencies by market capitalization. Market capitalization is regarded as the total value of a company. With the rise in the number of competitive companies, it is important to keep accurate track records of market capitalization. Market capitalization is calculated by multiplying the stock price by the number of shares. For example, a company with 2 million shares that are sold at 15 dollars each will have a market capitalization of 30 million dollars. Cryptocurrencies do well in keeping digital records of each Bitcoin in a computer file or application before any transaction is done.

What I learned about Bitcoin is that the price of each Bitcoin will rise or fall as the market moves. For example, on February 15, one Bitcoin was equivalent to $9,893.17. I think it looks like a stock. People can safely buy or exchange it. However, if you want to make money from this, you need to have a keen insight to predict the future of Bitcoin.