Cryptocurrency such as Bitcoin has become all the rage at the moment. Some historians see it as the latest phase in the evolution of money. Many technologies are intrigued by the potential of its innovative blockchain technology. For many entrepreneurs, cryptocurrency represents a once-in-a-lifetime wealth opportunity.
Cryptocurrency is the latest attempt to reinvent the way we exchange money. Throughout history; humans have relied on some sort of payment system to purchase goods and services. People initially used a bartering system, swapping things like livestock for grain but this proved to be difficult and inconsistent to the determined value.
To fix the inconvenience of bartering, intermediaries such as gold were used as a medium of exchange. Unfortunately, precious metals have a limited supply because they are difficult to produce. Thus, gold and silver were eventually replaced by government-issued currencies or what is known as fiats such as the US dollar and EURO. But because it is easy to make a lot of paper money, fiat faces issues such as inflation.
Actually, there has been one consistent theme regarding the evolution of payments; it’s that people prefer payments that are convenient and transactional. Consequently, some economists consider cryptocurrency the most important payment invention since gold.
Bitcoin began the cryptocurrency revolution when it launched in 2008. The origin of cryptocurrency is related to the beginning of the internet, which revolutionized the world like nothing before. After all, if there was no global system of interconnected computer networks, cryptocurrency wouldn’t be able to function.
David Traum is considered the earliest cryptocurrency pioneer in 1983 when he was a graduate student at Berkeley. He published a research article introducing the idea of untraceable digital cash; Traum is sometimes called the godfather of anonymous communication because he invented many encryption protocols that laid the groundwork for encrypted currencies.
He believes that privacy is necessary for an open society in the Internet age. However, government companies and other anonymous organizations cannot rely on suppliers. Therefore, it is necessary to create and encourage users to use a wide range of cryptography and other privacy tools.
Let us say that it took time before the idea of cryptocurrency became a reality. Although bitcoin is not the first proposed cryptocurrency, it’s notable because it’s the first working cryptocurrency. Equally important is the trailblazing record-keeping technology that is introduced to the world namely, BLOCKCHAIN.
Financial crisis and Bitcoin
After the financial crisis of 2008, people began looking for alternatives to an unreliable centralized financial system. That crisis represented the moment when the spark of digital currencies was launched. Bitcoin’s history begins on Halloween in October 2008. 31st Oct. 2008 was the day Satoshi Nakamoto published his white paper which outlined his vision for this new currency and technology. He announced his vision of electronic cash that would allow payments to be sent directly from one party to another without going through a financial institution.
The cryptocurrency uses digital wallets to store funds for everyone. Basically, you can fully control your own funds without having to rely on third-party institutions to transact or verify purchases on your behalf. It is also cheaper because there are no commissions for the transactions that occur. All of this happens between the parties who agree to transact with each other.
The spread of digital currencies
Today, there are thousands of cryptocurrencies in our world, more than 4,000 cryptocurrencies, and many of these currencies are listed on trading and investing platforms. Most of these cryptocurrencies have very little value and vague potential. People can buy and sell different cryptocurrencies such as Bitcoin, Ethereum, Ripple (XRP), Cardano (ADA), Dogecoin, TRX, and more.
If you are thinking of starting trading or investing in cryptocurrencies, you can do so easily by registering on one of the popular platforms such as; Binance, Coinbase or Kucoin.