What is Cryptocurrency and Bitcoin? Block Chain Explained

What is Cryptocurrency?

Cryptocurrency is a digital or virtual currency, secured by cryptography. "Crypto" means something encrypted in algorithms and codes. It allows individuals to directly make payments to each other. Cryptocurrency has a decentralized nature as there is no authority or community to manage it.

It uses a ledger for transactions. It is a public ledger maintained by Blockchain Technology. Blockchain Technology is what when transactions are recorded, chained and grouped together as blocks. The process of creating new blocks is known as mining. 

There are many cryptocurrencies like:

• Bitcoin (BTC)
• Dogecoin (DOGE)
• Litecoin (LTC)
• Ethereum (ETH)

What is Bitcoin?

Bitcoin is a type of cryptocurrency and also a digital form of cash. It was invented in 2009 by Satoshi Nakamoto. It is the first Blockchain-based Cryptocurrency. 

Some of the competing cryptocurrencies raised by the success of Bitcoin are Litecoin, Peercoin, Namecoin, and Ethereum as well as Cardano, and EOS.

Advantages and Disadvantages of Cryptocurrency

Advantages 

• Cryptocurrency promises to make easier fund transactions between two parties.
• These transfers are instead secured by different forms of incentive systems and the use of public keys and private keys.
• The owner's account address or wallet is a Public key while the Private key is known only to the owner, and transactions are made by using the Private key.
• Fund transactions are completed with a minimal amount of processing fees.

Disadvantages

• The decentralized nature of bitcoin makes it very suitable for illegal activities such as tax evasion.
• Since there is no authority governing cryptocurrencies, they have no fixed value. Recently Elon Musk announced that Tesla would not accept bitcoin and this caused the value of bitcoin to drop from $60,000 to $30,000 and it became such a big hit that the thing has been named as "Musk Dip".

Ultimately if Cryptocurrency has its advantages, then the disadvantages are also no less.

Is Bitcoin allowed in India?

The answer is Yes! but it is only allowed for investment purposes, not for general transactions and if you want to invest in Bitcoin then go should go to CoinDCX.