Everyone is raging about cryptocurrency and the market for trading in over two hundred different types of virtual currency has skyrocketed in the past few years. What’s this all about? What are cryptocurrencies? And why can they get so expensive?
We want to go over all the basics about this invention that is essentially marketed as a tool for shopping on the internet.
What Is Cryptocurrency?
Even though they became famous in the past few years they have existed on the market for nearly twenty years. They were invented by a mathematician. The main point of the virtual money is the crypto part. They are a kind of service that masks your monetary transactions by encrypting the information thru an advanced algorithmic game that is designed to always better the ability of the cryptocurrency to mask the information.
Basically, this means that you buy this virtual money and when you use it to purchase the transaction you make stays secret and you can hide that information from your bank or your country. This is an excellent criminal tool and a way to avoid paying a lot of money for tax.
The thing is that not all of them are effective in their job in the same way and the currency can get stronger over time. This is where the graphics cards come into play. Their main purpose is to play against the main program, this game that they play helps the program be better at encrypting and therefore better in hiding all the information that you don’t want to be discovered.
For those of you that still don’t get what encrypting is a short definition. Encrypting a method of replacing a sentence or a set of numbers with a coded set that conceals their true meaning, the encrypting process needs a method thru which it derives its replacements and in return this method allows the owner to decrypt the information once he needs it again.
Are there economic Risks?
Even thou some of these currencies are worth more than regular ones that are part of countries or other sovereign political entities they are in essence still not dominant enough to influence world economy in a major way. They can influence currency owners because they always have to monitor the currency market in order not to lose money.
The other thing, most big banks in the world do not recognize these currencies as a volute that they trade in, so even if you mined them you have to create a virtual valet for holding the money and a private dialer in currencies to trade in it.
Maybe the biggest problem that they bring and that a lot of countries have spoken about is the fact that international crime can be financed with these currencies as it has been on the dark web for some time. This fact can pose a great security issue over time but something will probably be figured out in order to resolve this problem.