Introduction to Cryptocurrency (Secure Money)

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  • DevynCJohnson
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    With the rise of the Internet and modern computing, many services and objects have become digital. For instance, there is email, ebook, social media, online shopping, etc. Now, there is digital money called "cryptocurrency". Cryptocurrency is a form of global currency that is produced/created via cryptography. This economy is decentralized and entirely tax-free.

    Cryptocurrency provides a way to pay for goods or services on the Internet even across political borders. Cryptocurrency (also called "Altcoins") can be exchanged/traded for typical currency and vice-versa. This digital money can be bought or sold on special websites (list below). Cryptocurrencies are popularly used on the Darknet to purchase special goods and services.

    Bitcoin Exchange

    Cryptocurrencies can be created by individuals on their computers. The creation of cryptocurrency is called mining and a person that makes cryptocurrency is called a miner. Mining requires a lot of CPU and/or GPU power since advanced cryptography algorithms are required to generate virtual money. Mining is legal and easy. However, it is time-consuming to the computer. Many miners have a computer dedicated to mining. The process is not very fast, but it an be worth it if the miner has an energy-efficient computer that they can dedicate to this process.

    Besides mining, users can earn cryptocurrency by minting coins. Not all cryptocurrencies support minting. Minting is the process of securing the cryptocurrency network via a proof-of-stake system. This means mints (computers fulfilling the minting process) ensure that the cryptocurrency is secure and accurate and help to prevent people from counterfeiting the cryptocurrency.

    Many types of cryptocurrencies exist and they follow the typical theoretical laws and concepts of traditional economics. Each one can be easily traded/exchanged from one to another. Bitcoin is the most popular cryptocurrency. However, some cryptocurrencies are easier and faster to mine than Bitcoin.

    Cryptocurrencies have different monetary values relative to each other just like currencies of different countries. For instance, one cryptocurrency can be exchanged for another type, and cryptocurrencies have an exchange rate that may change daily. People can invest in cryptocurrencies similar to a Forex investment. Various exchange rates can be seen at https://www.cryptonator.com/rates

    The Cryptonator (https://www.cryptonator.com/) offers many cryptocurrency services such as online wallets, exchanges, exchange rate charts, etc.

    Some of the different cryptocurrencies are discussed below.

    Bitcoin

    Bitcoin was the first decentralized cryptocurrency, and it was introduced January 3, 2009 by Satoshi Nakamoto. Bitcoins are accepted by many large companies/businesses such as Microsoft, Dell, Mozilla Foundation, Dish Network, TigerDirect, and others. Coinkite (https://coinkite.com/faq/card) is a company that offers many cryptocurrency services including Bitcoin debt cards that can be used like a regular banking debt card.

    Blackcoin (BLKCoin)

    Blackcoin was made by a developer known as "Rat4". Blackcoin is becoming popular very quickly and may be an excellent alternative to Bitcoin. Blackcoin has a low inflation rate.

    Dash (formerly "Darkcoin")

    Dash (or Digital Cash) is another cryptocurrency, but this one has additional privacy compared to Bitcoin. Dash is commonly used on the Darknet (hence the former name "Darkcoin"). Dash is made using an X11 hashing algorithm (not related to X11 display protocol). This X11 hashing algorithm uses less power than scrypt or SHA-256. The X11 hashing algorithm is a series of eleven cryptographic hashing processes. Originally, before Dash was called Darkcoin, it was called XCoin.

    Litecoin

    Litecoin has a lot in common with Bitcoin. However, Litecoin is entirely open-source without any central authority. Also, Bitcoin uses SHA-256 while Litecoin uses Scrypt. This allows miners to more easily create both Litecoins and Bitcoins at the same time.

    Mastercoin

    Mastercoin is a cryptocurrency and communications protocol that is built on top of Bitcoin. Mastercoin is to Bitcoin as HTTP is to TCP/IP. Sometimes, Mastercoins are called the Bitcoin Omni-Layer.

    Namecoin

    Namecoin is the first Bitcoin fork. Namecoin places more data in a block than Bitcoin. Namecoin uses a top-level domain called ".bit" which is not an official ICANN top-level domain name. This helps to secure people's right for privacy by providing extra privacy and reducing or preventing government censorship.

    Potcoin

    Potcoin is a fork of Litecoin with minor changes. For instance, Potcoin has a larger economy limit (maximum amount of coins), faster halving schedule, and a smaller block generation time.

    PPcoin (PeerCoin)

    PPcoin or Peercoin is the fourth largest minable cryptocurrency and it lacks an economic limit. PPcoin uses SHA-256. Users can gain more PPcoins by mining or minting.


    Onion Cryptocurrency Websites

    Further Reading

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