AUTHORED BY ISHA KASAT
Cryptocurrency is a form of digital currency that operates on a decentralized system, that is without the control of any central authority such as banks, governments, or financial
institutions, making crypto transactions immune to an third-party interference.
Instead, it has a working structure based on advanced technologies like ‘blockchain’and ‘cryptography’. Some popular cryptocurrencies being Bitcoin, Ethereum, Ripple,
Dogecoin, etc. Understanding“Blockchain”and “Cryptography”in Simple
Terms“Blockchain”is a database or a public ledger of transactions that is maintained by a network of computers that record and validate the transactions. When these transactions are grouped together, they are called “blocks”which cannot be altered or deleted therefore giving users greater transparency and no chances for manipulation and fraud. Cryptography is a scientific practice that uses various techniques that provide security and protection to the
data from unauthorized access by converting original data into encoded data through the process of encryption algorithm ensuring confidentiality and protection of user identities through pseudonyms which separates your personal identity from your online
presence.
1. Buy them on cryptocurrency exchanges such as CoinDCX, Coinbase, Binance, etc using regular money like rupees or dollars.
2. Receive it as payment from others.
3. Earn it by the process of mining which involves solving complex mathematical problems using advanced computer hardware and receiving cryptocurrency coins as rewards.
Advantages and Disadvantages of Cryptocurrency
Advantages:
Gives users greater ownership and eliminates
interference from third parties.
1.Provides enhanced security against fraud and hacking.
2.Privacy and identity protection.
3.Borderless transactions at much lower transaction cost.
4.Can be used to earn returns.
Disadvantages:
1 Limited acceptance by businesses, merchants, and some countries.
2.Allows criminal activities due to advanced identity protection.
3.Expensive to participate in and earn through activities like mining.
Though cryptocurrency might still be struggling in terms of legal status and acceptance by some countries, the major economies of the world have adopted and recognized
cryptocurrencies as assets. While today’s crypto market is experiencing a slight downside, contrary to its powerful start to the year, trading at $1.27 trillion as of Oct. 31, 2023. The reasons behind the bearish trend are macroeconomic factors like inflation andhigh-interest rates affecting every market and not only crypto, though it is showing a hopeful recovery in the future. Additionally, in crypto’s favour, Blackrock which is one of the world’s largest asset management funds, is moving into crypto Exchange-Traded Fund (ETF) for their promising growth in coming times. A Crypto-ETF could provide an extensive base of investors. Considering the major reason that holds investors off is the risky direct-ownerships and the requirements it offers such as the necessity of wallets etc which are solved by the Crypto-ETF and making the proposal by BlackRock, represent a game-changing movement in the future of these digital assets
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