Cryptocurrencies are blockchain-based digital currencies and therefore do not exist in physical form. They can be used to shop but also to participate in different platforms. They are also called cryptocurrencies and being mostly Cardano Exchange decentralized they have been developed outside the traditional banking and government systems. Specifically, it is a currency generated through computer code and based on peer-to-peer protocols.

The individual units that make up a cryptocurrency are therefore sequences of encrypted data that have been encoded to represent a unit.

The use, exchange and transactions of cryptocurrencies are guided by some principles that characterize blockchain technology and, sometimes, the mining process. The miner or validator is the one who makes the computing power of his computer available to the network, to validate transactions in the blockchain.

Cryptocurrencies benefit from blockchain technology which, being a register made up of blocks of data, guarantees the recording of transactions carried out between all users of the network. The registration cannot be changed without the total consent of the members of the network. The best-known cryptocurrency is Bitcoin, but there are over 3 thousand of them.

A good part of the existing cryptocurrencies, including Bitcoin, is based on a blockchain whose rules are dictated by the one defined as Proof of Work. The Proof of Work is a form of consensus used for the creation of new coins that through mathematical calculations and algorithms hook new blocks of the blockchain chain. The miners are those who regulate the creation of crypto.

The main cryptocurrencies besides Bitcoin

Cryptocurrencies arise from the need to have an alternative online payment method. However, they are not usable for all businesses and by all consumers and they are not yet very suitable to be used as a payment alternative as many people see their volatility as a big problem. There is another main and important reason why cryptocurrencies are born, namely to fill a vacant position in finance after the crisis.

What makes this new world interesting is the detachment from central bodies such as banks, governments … being independent of a system that had just before brought down the world economy.

Ethereum

ETH was born from the idea of ??Vitalik Buterin, a young Russian programmer and writer, to create a real contractual system, which makes use of smart contracts, parallel to the traditional one and a virtual currency, Ether, the real perfect fuel for this engine. This system was introduced online in 2015 and today is the best known digital currency after Bitcoin.