Blockchain Made Easy – Part 5

Bitcoin cryptocurrency: Most Popular Application of Blockchain

 

What is Cryptocurrency?

A cryptocurrency is one medium of exchange like traditional currencies such as USD, but it is designed to exchange the digital information through a process made possible by certain principles of cryptography. A cryptocurrency is a digital currency and is classified as a subset of alternative currencies and virtual currencies.

Cryptocurrency is a bearer instrument based on digital cryptography. In this kind of cryptocurrency, the holder of the currency has ownership. No other record is kept as to the identity of the owner. In the year 1998, Wei Dai published “B-Money,” an anonymous, distributed electronic cash system.

What is Bitcoin?

Bitcoin was launched in 2009 by an unknown person called Satoshi Nakamoto. Bitcoin is a Peer-to-Peer technology which is not governed by any central authority or banks. Currently, issuing Bitcoins and managing transactions are carried out collectively in the network. It is presently the dominant cryptocurrency of the world. It is open source and designed for the general public, which means nobody owns the control of the Bitcoin. In fact, there are only 21 million Bitcoins issued. Currently, Bitcoin has a market cap of $12 billion.

Anyone can use bitcoin without paying any process fees. If you are handling Bitcoin, the sender and receiver transact directly without using a third party.

Blockchain and Bitcoin:

The blockchain is the technology behind Bitcoin. Bitcoin is the digital token, and blockchain is the ledger that keeps track of who owns the digital tokens. You can’t have Bitcoin without blockchain, but you can have blockchain without Bitcoin.

Other prominent cryptocurrencies
  • Ethereum
  • Bitcoin Cash
  • Ripple
  • Litecoin

Next week, we will be examining the final part of the “Blockchain made easy” series and our focus will be myths about the blockchain as well as the limitations of the technology. Stay tuned!


 

Written By: Ben 

Edited By: Mosun

 Graphics By: Rufans

About the author

A community building project to educate African youths about the possibilities of blockchain technology powered by the Telos network.

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