What Is Cryptocurrency
Cryptocurrencies exist to address weaknesses in traditional currencies which are backed by central banks and governments. This makes traditional currencies prone to corruption and manipulation, among a host of other issues.
A cryptocurrency is a medium of exchange just like your normal everyday currency such as the USD, but designed for the purpose of exchanging digital information through a process known as cryptography
Digital cash system
The reason why cryptocurrenciesare such in demand right now is because Satoshi Nakamoto successfully found a way to build a decentralized digital cash system.
The future of Bitcoin?
Bitcoin runs on highly complex mathematical algorithms to regulate the creation of new bitcoins and to make sure no double spending ever occurs on the network (remember, this is the Achilles’ heel of failed virtual currencies before Bitcoin).
The Bitcoin code is so secure and advanced that it’s virtually impossible to cheat the system so if you’re thinking you can create an unlimited number of bitcoins, you’re greatly mistaken.
One of the main problems of traditional currency is that these aren’t limited in number. This means that governments and central banks can print more money when they see fit.
When more money is printed and enters the economy, this reduces the purchasing power of our paper money which means we need to spend more for an item we’ve only spent a few dollars on before; this is called inflation.