In the year 2008 an unknown person named Satoshi Nakamoto , invented a digital and decentralised currency called cryptocurrency and named it BITCOIN . He writes a code to develop a digital currency.
Cryptocurrency is a decentralised currency which cannot be controlled by a person or a group of persons.
The cryptocurrency is based on a technology called BLOCKCHAIN .
Let us understand about BLOCKCHAIN -- The Blockchain is a technology which can be used for frequent and more secure transactions. A blockchain is a chain of thousands of blocks which can store data within them , a block mainly consists of three parts – • Hash of that block • Data • Hash of previous block
Hash of that block -
A hash is a 64 characters long hexa-decimal no. which provides a unique identity to a block and hash of two blocks cannot be exact same. The first ever block was was mined on January 09, 2009 at 8:24 AM GMT+5:30 by a an person named Satoshi Nakamoto and named the block the Genesis Block. This is how the hash of first ever block looks like -
This no. provides the unique identity to block no .1
Every block in block chain consists of data of different transactions which include the sender’s and receiver’s address , and it also consist of timestamp on which the transaction has taken place. One block can store data up to 1 MB which is enough to store data for 2000 transactions in a single block.
The hash of the previous block –
Since blockchain is a chain it consists of blocks behind one another , so there is always one block behind the every block For example the block no 100 has block 99 behind it in blockchain , so the hash of block 99 is present in the block 100 and hash of block 100 is present in block 101 and so on..
Now you might be wondering what is the previous hash of the first block , so when blockchain was started the previous hash of first block is given as 0.
How the blockchain is secure rather than other mode of payment – The blockchain technology is more secure because if someone wants to tamper the blockchain or wants to steel money , he have to hack tens of thousands of computers simultaneously which is next to impossible. And once the blocks is created , the data inside it can not be changed once created it is immutable , if person wants to change data or hash of the block , then he have to hack all the corresponding blocks which is next to impossible to hack all blocks all over the world. If hacker tries change the data , it will inform the blockchain that there has been some tampering in data and the hacker got caught by his public Id
Satoshi Nakamoto published a whitepaper of bitcoin which states all about bitcoin’s proof of work , transactions , privacy , combining and splitting value , etc You can read this whitepaper on the link below
Some countries have started taking payments in cryptocurrency.
Even tesla also accepts payment in bitcoin.
Some of the famous cryptocurrencies are –
And many more….
Many people across the globe thinks that the cryptocurrency will replace the fiat currency
What do you think tell us in the comments below.
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