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Crypto Currencies - What are they?

Written by  Siddarth Wednesday, 31 May 2017 05:29

There are currencies, there are digital currencies and then there are crypto currencies. The name does sound as if it were picked right out of a James Bond movie or a Dan Brown novel but lets try and simplify things.

 

What are crypto currencies?
Cypto currencies are currencies that are created and recorded electronically, in a database that is distributed. The creation of units of such currencies (or called as mining) is through encryption techniques. The distributed database is called a ledger.

How do I create crypto currencies? Can I ask my employer to pay me in these currencies?
To answer your second question, not yet. Many central banks including the Reserve Bank of India has not given crypto currencies any legal status in the country.
You can earn/create crypto currencies by a process called Mining. Mining is a process where individuals or companies use their own resources to add transactions to the ledger and also ensure the security of the network. In the earlier days, there wasn't a lot of competition and many "miners" made a lot of bitcoins. The same has become very competitive today.

More info at https://bitcoin.org/en/faq#what-is-bitcoin-mining


What are the various crypto currencies available?

There are quite a few. Begining with the 800 pound gorilla, Bitcoin to others such as Ripple, Dash etc, there are many. Below is a quick primer

 

The first crypto currency, bitcoin ushered in an era of privacy in payments like no other payment mechanism did. It also created the concept of distrbuted ledger or block chain, which today finds its applications in healthcare, finance and other areas. Bitcoin price (in terms of USD) has risen from USD 207 (on Jan 16th, 2015) to USD 1437 today. Wish you had bitcoins stashed away :)

 

Among the first few following bitcoin,Litecoin is like Bitcoin in many ways, it has a faster block generation rate and hence offers a faster transaction confirmation. Other than developers, there are a growing number of merchants who accept Litecoin.

 

Zcash, a decentralized and open-source cryptocurrency launched in the latter part of 2016, looks promising. “If Bitcoin is like http for money, Zcash is https," is how Zcash defines itself. Zcash offers privacy and selective transparency of transactions.

Dash (originally known as Dark coin) is a more secretive version of Bitcoin. Dash offers more anonymity as it works on a decentralized master code network that makes transactions almost untraceable.

 

Ripple is a real-time global settlement network that offers instant, certain and low-cost international payments. Ripple “enables banks to settle cross-border payments in real time, with end-to-end transparency, and at lower costs”.

Monero is a secure, private and untraceable currency. Monero has been launched with a strong focus on decentralization and scalability, and enables complete privacy by using a special technique called ‘ring signatures’.


Source :http://www.investopedia.com/tech/6-most-important-cryptocurrencies-other-bitcoin/

We hope that the crypto in crypto currencies is no longer "crypto". 

Read 870 times Last modified on Wednesday, 31 May 2017 09:45