Читать книгу The Book about Cryptocurrency № 1 - Viacheslav Nosko - Страница 4

This industry is a newcomer among other types of economies, businesses and human interests. It was 2008 when the bitcoin.org website was officially registered and the first coins appeared.

However, there was not as much HYIP with any other instrument in the sphere of finance and charge back as there was around crypto from the very first years of its existence.

If we look at the essence of the term, its roots come from Greek. Translated from the language of Antiquity – Greek – “kryptos” is “secret, hidden”. Cryptocurrencies work using data encryption technology or cryptography.

Distinctive features of cryptocurrency:

• decentralized data that is stored simultaneously on multiple computers;

• anonymity (you do not know who transferred you the money, you do not know who owns the wallet, where you transfer money to);

• Security (transaction record cannot be falsified or modified).

We are confident that cryptocurrency is a new generation of assets that will change our lives.

Although, there are still many skeptics who believe that cost of bitcoin and other coins is exaggerated, that their rate will sooner or later collapse, that this money is useless …

This is usual resistance to something new. Some time ago people did not believe in bank cards and were afraid of ATMs. Some time ago a smartphone with its simplest functions seemed to be fantastic. But it will take a little more time and cryptocurrency will become a common payment tool for all layers of the population.

This book, among other things, will help you understand the idea of new money; learn how to treat it and not to lose your hard-earned fiat money on cryptocurrency trades. But more on that will be later in the book …

The revolutionary characteristic of cryptocurrency is that transactions are conducted directly among users, without any participation of anyone else.

For example, if you want to order a memory card for a phone or a fashionable T-shirt on Aliexpress, you will need a bank card to pay for it. Thus, there is an intermediary between you and the online store – a bank. Soon, Aliexpress and other online trading giants will accept crypto along with bank cards, Webmoney and PayPal.

The basis for the development of cryptocurrency was the invention of the blockchain technology.

Blockchain is a distributed information storage system. The blockchain system does not have a single server that stores the entire database; information can be simultaneously recorded on several devices.

All data in the blockchain network is recorded in blocks that are interconnected.

All transactions pass in the chain of blocks. Each transaction is recorded in a block, and it can no longer be changed. In order to form a new block, it is necessary to make certain calculations. The computer that solved the task gets its reward in bitcoins. This process is called ‘mining’ and the owners of computers that do the calculations are ‘miners’.

The more miners in the world, the faster transactions can be processed and the more stable the whole system is.

What is Bitcoin? This is, basically, the name of the network which began operating in 2009 and which the blockchain technology is used in.

To make these concepts clear, we state one more time:

Blockchain – this is a technology that can be

applied not only to cryptocurrency;

Bitcoin – is the first cryptocurrency, the progenitor of all other coins and now is the most expensive crypto.

The term “cryptocurrency” was spread in 2011 due to the publication about bitcoin in Forbes magazine. Then the term “cryptocurrency” began to denote any crypto money.

The word “bitcoin” is formed from two English words: “bit” is a unit of information and “coin”.

This is the first, the most expensive and having the largest capitalization cryptocurrency so far.

The goal of creating Bitcoin is a universal global decentralized payment system that is not controlled by banks, governments, and other intermediaries. Bitcoin, like other cryptocurrencies, helps to execute payments p2p (person to person).

Bitcoin advantages compared to traditional (fiat) currencies:

• No one will ever be able to block a Bitcoin account. It is your funds forever. Only if you follow the digital security methods. We will talk more about safety precautions. And more than once.

• Account transactions are both anonymous and transparent at the same time. The list of transactions can be traced in a public ledger. At the same time the information of who sent the money and who to is unknown.

• Unlike a traditional bank account, a cryptocurrency account is not tied to any personal data.

But everything is not so awesome. There are also bitcoin and other cryptocurrency cons:

• If you make a mistake with the wallet number (it is not difficult to make a mistake here – the ID of each wallet consists of 34 characters, including numerals, upper and lower case letters and other signs), then it will be impossible to cancel the transaction. Attention and thoroughness are the keys to success in working with cryptocurrency.

• The cryptocurrency market shows high volatility due to its rapid growth and the characteristics of the cryptocurrencies themselves. (Volatility is the level of price changes on the market. High volatility is when the price can change significantly over a short period of time.) That is why inexperienced and novice crypto traders lose money, because it is very difficult to predict how the market will behave in next months.

• If the wallet is hacked or lost, if you forget your password or passphrase (seed phrase) of the wallet, then it is impossible to return the lost funds.