History 

History of Cryptocurrency

With the launch of Cryptocurrency, the world is expecting a revolutionizing change with regards to how transactions will be conducted in the future. Many people are already using Cryptos to make daily transactions. This digital asset is also referred to as ‘digital gold’. But there is more to cryptocurrency that you should be aware of.

Reasons for its launch

This digital asset has been launched with the objective to make it a popular medium to carry out financial transactions. With time and increased usage, it is becoming a close substitute to hard cash. To enhance financial transaction security, it uses powerful cryptography. This is to verify asset transfer and to control development of additional units. Cryptocurrencies are generally alternative, digital or virtual currency. All of them rather follow decentralized control system against centralized systems followed by financial institutions and banks. For this, distributed ledger technology is used to serve as public financial database. Blockchain is generally used.

About blockchain

There are records that are growing continuously and are secured and associated with cryptography. The list stated here is referred to as blocks. Blockchain is considered to be a distributed, open ledger. Its purpose is to record transactions taking place between two parties that are permanent and verifiable. Hence to use the block as distributed ledger, peer-to-peer network manages it that collectively adheres to a particular protocol. This is to validate new blocks. On recording the data in the ledger, it is not possible to carry out any alteration without altering other blocks. Hence, by design, blockchains are secure while acting as a classic example for distributed computing system.

Cryptography and its history

Cryptographic electronic money referred to as e-cash was discovered in 1983 by an American cryptographer called David Chaum. He tried to implement the same in 1995 through Digicash. It is considered to be an earlier version of cryptographic electronic payment. However, user software will be essential to withdraw bank notes. Before the sending it to the recipient, it designated specific encrypted keys. Thus, the government, third party or issuing bank was unable to trace the digital currency.

In 2009 was launched Bitcoin, considered to the very first decentralized cryptocurrency. Satoshi Nakamoto had developed it. For cryptographic hash function, it used SHA-256. Very soon, other cryptocurrencies also got launched like Namecoin in April 2011, Litecoin in October 2011 and Peercoin. Combined together, they are known as altcoins.

Choosing a cryptocurrency platform is essential to carry out transactions. But make sure to select the best one that matches your preferences.