Cryptocurrency, a term that is quite cool and trendy, especially for investors today. If you have never heard of or never heard of but you still haven’t imagined what cryptocurrency is, let’s read this article to the end. This paper will discuss starting from history, Cryptocurrency is a digital currency that is used as a medium of exchange, as well as the euro or dollar. Cryptocurrency types based on en.wikipedia.org, based on the latest data taken ie in August 2018, the number reached 1600 types and continues to grow.
The next question that arises is why does this type of cryptocurrency continue to develop? Digital currencies are generally safer than physical currencies, because they are decentralized. The first cryptocurrency discovered was Bitcoin, which was discovered by Satoshi Nakamoto in January 2009. Uniquely the inventor, Satoshi Nakamoto is an alias and until this article was written the true identity of Satoshi Nakamoto has not been known.
The rapid development of Bitcoin as a cryptocurrency, gave rise to other initiators in the world of cryptocurrency. How come? In the past 7 years the value of selling Bitcoin rose 35,500 times and tends to continue to rise. Other cryptocurrency that also rose rapidly were Litecoin, Ethereum, and Dogecoin.
But how does this Cryptocurrency work? A decentralized money system is a network that is able to connect consumers without going through intermediaries or third parties such as banking or government. Through smartphones and laptops connected to the internet, consumers can send or receive money anytime and anywhere in the world in a matter of minutes.
Whereas a centralized system requires more operational costs, besides having fairly strict rules, making it less efficient and effective. These problems are trying to be solved through the blockchain system, which is a platform on which digital currency is run. Cryptocurrency relies closely on this blockchain system, because all transaction processes are recorded using a blockchain system.
The function of this blockchain is to manage and maintain each additional data stored in each block. The blocks that store the data will relate to each other and form a decentralized network or peer to peer (P2P) network. In a blockchain, data stored or recorded cannot be falsified or edited. P2P network is a network of agreements, where this system is able to present a new payment or transaction system.
Each of these networks will have a complete record of the history of all transactions that occur as well as each balance held by each Bitcoin owner account. There will be an explanation on each transaction, for example A has sent a sum of money to account B, then digitally signed by A by giving a private key to the system. The transaction record is permanent and cannot be deleted, other than that the process is very transparent, so that anyone or even non-users can access the transaction history.