WHAT IS CRYPTOCURRENCIES?

A cryptocurrency, cryptocurrency or cryptocurrency is a digital medium of exchange that uses strong cryptography to secure transactions, control the creation of additional units, and verify the transfer of assets using distributed ledger technologies. Cryptocurrencies are a type of alternative currency or digital currency. There is controversy that cryptocurrencies have to be decentralized control or centralized currencies by central banks or another entity.

The control of each currency works through a decentralized database, usually a chain of blocks (in English blockchain), which serves as a database of public financial transactions.

The first cryptocurrency that began to operate was Bitcoin in 2009, and since then others with different characteristics have appeared such as Litecoin, Ethereum, Bitcoin Cash, Ripple, Dogecoin.

 

In cryptocurrency systems, the security, integrity and balance of your account statements (accounting) is guaranteed by means of a structured network of agents (segmented file transfer or multi-source file transfer) who verify (distrust) each other called miners , which are, for the most part, the general public and actively protect the network (the fabric) by maintaining a high algorithm processing rate, in order to have the opportunity to receive a small tip, which is distributed randomly.

Breaking the existing security in a cryptocurrency is mathematically possible, but the cost to achieve it would be unacceptably high. For example, an attacker attempting to break Bitcoin's proof-of-work system would need computational power greater than that of the entire lattice (swarm-net) of all miners in the system, and still only have a probability of success of 50% (# of authentication round), in other words, breaking Bitcoin's security would require greater capacity than tech companies the size of Google.

It is expected that in the future quantum computing could become a reality, which would break the balance in the event that developers could not implement the system in time to use post-quantum algorithms, as it is a proprietary technology.

Cryptocurrencies make possible the so-called internet of value, also known by the acronym IoV (internet of value), also called the Internet of money: they are Internet applications that allow the exchange of value in the form of cryptocurrencies. This value can be contracts, intellectual property, stocks or any property of something with value. Things of value could already be exchanged before using payment systems such as Paypal. However, the difference between paying with something like Paypal and paying with a cryptocurrency is that paying with Paypal requires that payment be made through private networks such as credit cards and banks, while payment using cryptocurrencies does not have intermediaries. It goes directly from the buyer to the seller. In this way, there is a universal value transfer system, free from intermediaries.

Published on: 10/26/20, 2:22 PM