What Makes Cryptocurrencies Unique?
There is no need for an introduction to cryptocurrencies in today’s World. Everyone is aware of bitcoins, ethereum and the cryptocurrency trade flourishes like anything. At one side, experts are arguing that these digital currencies may surpass the fiat currencies in the near future. And on the other side, trading professionals are debating and forecasting the value of the cryptocurrencies and piling them up accordingly. This is marked as a healthy sign and the digital currencies are believed to transform the whole financial system in a different way. One thing that strikes our mind is why they are so special? Are the digital currencies overhyped? This article is the answer to these questions and finds out more about the virtual currencies.
Cryptocurrencies are trusted less, which means there is no need to trust anybody else in the network in order to function. The transaction network consists of a number of nodes. When the transaction is initiated, the nodes receive the signal, validates the signatures and pass it on through the blockchain. If the signature is invalid, the transaction is dumped. Everyone in the network has a copy of the ledger and throughout the process, they don’t need to trust or communicate with any single entity or organization. Validation of signature against the ledger is enough to perform a successful transaction.
Once done, it is done!
All the transactions performed are irreversible. The transactions are end to end. If we are doing a transfer via bank, we can check the transaction history and we can highly trust our bank that no fabrication of data and manipulation can be done. This is the typical structure of a centralized organization. The cryptocurrencies are decentralized entities with no third party interference and that is why they are made immutable.
Unlike fiat currencies, the cryptocurrencies won’t suffer any inflation as they are infinite in number with specific parameters. Their value is subject to change but they never run short. The only possibility of losing a cryptocurrency is the destruction of coins followed by the lost private key. People’s interest and adoption make it going.
These attributes are unique with respect to cryptocurrencies. To facilitate the trading, software like Crypto code has been launched recently. It serves as the platform for trading bitcoins and ethereum. In a few years, we can expect a huge changeover in the financial system around the world. Cryptocurrencies will rule the economy!