Imagine you're having conversation with your friends, now at some point in this conversation someone's going to bring up cryptocurrencies, now cryptocurrencies is something that everyone wants to talk about, but no one really knows how they work, so today, I'm going to fix that. I route you from simply learn and this is cryptocurrency explained since man world, currency has been a very important part of our lives in the caveman era, they use the barter system now the barter system involves goods and services being exchanged among each other, so now we have a situation, where a caveman is exchanging seven apples and getting oranges in return now the barter system fell out, because it had some glaring flaws, now these flaws include having people's requirements coincide, for example, say you have five apples and your friend has five oranges, you want some of his oranges, now until and unless your friend has a requirement for the apples that you own, he'll not be ready to make an exchange for it, there's no common measure of value, now since there's no common measure in terms of which value of a commodity can be expressed, there's a problem when you have to decide how many apples you are ready to trade for one orange or a mango, not all codes can be divided or subdivided, for example, you can divide a live animal into different smaller units, the goods cannot be transported easily now unlike our modern currency fits in your wallet or your mobile phone, the goods that you own cannot be taken with you everywhere you go, after realizing that the barter system then work very well, currency went through a few iterations in 110 BC, an official currency was minted in 1250AD gold-plated. Florence introduced this & used across Europe, from 1680 to 1980 paper currency gained widespread popularity and was used across the world, this is how modern currency as we know, it came into existence modern currency included paper currency and coins credit cards and digital wallets. for example, you have Apple Pay, Amazon pay, pay DM, PayPal, and so on. All of these are controlled by banks and governments, now this means that there was a centralized regulatory authority, that delimited how paper currency and credit cards worked, now imagine the scenario of doing an online transaction, here you're thanking your friend for paying for your lunch, are you saying that you're sending the money to their account, now this transaction takes place successfully, but there are several ways where this could have gone wrong, they could have been a technical issue at the bank. for example, the systems could have been the machines weren't working properly and so on that means there's a central point of failure which is the bank the users accounts could have gotten hacked. for example, they could have been a DDoS attack or identity theft and so on or the transfer limits for that account were exceeded, this is why the future of currency lies with cryptocurrency, now imagine the transaction between two people in the future one of them has the Bitcoin app and there's a notification asking whether they sure they're ready to transfer five bitcoins if yes processing takes place here, we're authenticating the users identity checking whether they have the required balance to make that transaction and other things, now after that's done the payment is transferred and the payment is received all of this happens in the matter of minutes and is as simple as that this in turn removes all the problems of modern banking, there are no limits to the funds, you can transfer your accounts cannot be hacked and there's no central point of failure now as of 2018 there's more than 1,600 cryptocurrencies available, now there are some popular ones like Bitcoin, Litecoin, its Harry amends. each cash and a new cryptocurrency crops up every single day. now considering how much growth they're having at the moment, there's a good chance there's plenty more to come in the upcoming years, so what exactly is cryptocurrency? a cryptocurrency is a digital or virtual currency that is meant to be a medium of exchange. now cryptocurrency is quite similar to real-world currency, just that it does not have any physical embodiment, it also uses cryptography to work the way it does, now some of the features of cryptocurrency are that there's a limit to how many units can exist with Bitcoin, this limit exists at 21 million, now after this no more bitcoins will be produced you can easily verify the transfer of funds. now the hashing algorithms that Bitcoin uses makes it very easy for users to determine whether a transaction is valid or not. they operate independent of a bank or a central authority. they work in a decentralized manner. now new units can be added only after certain conditions are met. for example, for Bitcoin only after block has been added to the blockchain will the miner be rewarded with bitcoins and this is the only way new bitcoins can be generated, so what makes cryptocurrency so special? firstly there's little to no transaction costs. now if you use the digital wallet, you'll know that if you're transferring money from your wallet to your bank account you lose some amount of money, you have 24/7 access to money, you can't just walk up to your bank at 3 a.m. morning and say that you want to withdraw some money there are no limits on purchases, there's freedom for anyone to use. for example, if you are setting up an account in your bank you need to do some amount of paperwork and documentation, with cryptocurrencies all of that can be avoided. international transactions are faster. the wire transfers take about half a day to transfer money from one place to another. but with cryptocurrencies it only takes a matter of minutes or seconds. what's the crypto in cryptocurrencies? crypto,
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