In the changing times that we’re surviving in, technology has made unbelievable advancement compared to any time previously. This evolution has redefined the life span of man on nearly every aspect. In fact, this evolution can be an ongoing process and thus, human life on earth is improving constantly day in and day out. Among the latest inclusions in this aspect is cryptocurrencies.
Cryptocurrency is only digital currency, which has been made to impose security and anonymity in online monetary transactions. It uses cryptographic encryption to both generate currency and verify transactions. The new coins are created by way of a process called mining, whereas the transactions are recorded in a public ledger, to create the Transaction Block Chain.
Evolution of cryptocurrency is principally attributed to the virtual world of the web and involves the task of transforming legible information into a code, that is almost uncrackable. Thus, it gets easier to track purchases and transfers relating to the currency. Cryptography, since its introduction in the WWII to secure communication, has evolved in this digital age, blending with mathematical theories and computer science. Thus, it really is now used to secure not merely communication and information but also money transfers across the virtual web.
How to use cryptocurrency
It is very possible for the ordinary people to utilize this digital currency. Just follow the steps given below:
You will need a digital wallet (obviously, to store the currency)
Make use of the wallet to create unique public addresses (this enables you to have the currency)
Use the public addresses to transfer funds in or out of the wallet
A cryptocurrency wallet is nothing else when compared to a software program, which is competent to store both private and public keys. Moreover, it can also interact with different blockchains, in order that the users can receive and send digital currency and also keep a track on the balance.
In contrast to the conventional wallets that we carry inside our pockets, digital wallets do not store currency. In fact, the idea of blockchain has been so smartly blended with cryptocurrency that the currencies never get stored at a specific location. Nor do they exist any place in hard cash or physical form. Only the records of your transactions are stored in the blockchain and nothing else.
A real-life example
Suppose, a friend supplies you with some digital currency, say in form of bitcoin. What this friend does is he transfers the ownership of the coins to the address of your wallet. Now, when you want to utilize that money, you’ve unlock the fund.
So as to unlock the fund, you must match the private key in your wallet with the public address that the coins are assigned to. Only when both these private and public addresses match, your account will undoubtedly be credited and the balance in your wallet will swell. Simultaneously, the balance of the sender of the digital currency will decrease. In transactions linked to digital currency, the actual exchange of physical coins never take place at any instance.
Understanding the cryptocurrency address
By nature, this is a public address with a distinctive string of characters. This enables a user or owner of an electronic wallet to get cryptocurrency from others. Each public address, that’s generated, has a matching private address. This automatic match proves or establishes the ownership of a public address. As a far more practical analogy, you may consider a public cryptocurrency address as your email to which others can send emails. The emails are the currency that people send you.