The history of virtual Currencies
The history of cryptocurrency is actually not very long. Yes, we had digital currency systems before these cryptocurrencies came into existence, but it’s not similar. As we mentioned in our “What is cryptocurrency” page, ancient versions of digital currencies were strictly centralized, while these new forms of cryptocurrency, such as Bitcoin, Ethereum and ripple, are decentralized in nature.
Satoshi Nakamoto: Founder of bitcoin
Now, what’s really interesting with cryptocurrencies is that they were never designed to be invented as they are known today. It all started with the now ill-famed Bitcoin and an anonymous man named Satoshi Nakamoto. Nakamoto’s goal at the start was to create nothing more than an electronic peer-to-peer money system. People had been trying for a long time to create some kind of digital payment system that works online with the help of internet, but had always failed due to centralization problems.
Satoshi Nakamoto knew that another attempt to build a centralized online checkout system would only lead to more failures, so he decided to create a digital system without a single authority. And this is how the invention of Bitcoin had occurred. Yes, Satoshi Nakamoto invented Bitcoin, the very first form of decentralized digital money that had no central body of governance or control. Bitcoin was to be owned by the entire Bitcoin community.
Nakamoto created Bitcoin in 2008 and its value has certainly exploded. When it was created, it was worth just over a penny. However, the value increased rapidly and by the end of 2009 had already reached $ 27 for a single Bitcoin. Now, in 2020, a single Bitcoin has a value of over $ 7,000, so as you can see, the value of this particular cryptocurrency has skyrocketed to any levels.
Problem faced in the application of cryptocurrencies
Going back to the creation of Bitcoin, the big problem Nakamoto faced was to stop double-spending, the act of a currency owner spending twice the same money. This control overspending and the amount of cryptocurrency present in the digital world was previously always controlled by a central authority, so the digital currencies of whey were always centralized. It was a way of ensuring that there was no double expense. Nakamoto understood how to create a digital currency that did not require this central authority. In a decentralized digital currency system, each user or entity must agree on each account balance and transaction for this to work.
Though, Nakamoto was able to create this cryptocurrency system, where full consensus is required of all parties, and if there is a disagreement between the parties, the whole thing breaks down. It may all seem very complicated and almost impossible to execute, but Nakamoto and his invention of Bitcoin have proven that everything is wrong. Bitcoin and other cryptocurrencies demonstrate that it is not necessary for any type of central authority to control spending and account balances as long as there is total consensus among all parties involved.
Bitcoin and its imitators
Since Nakamoto revealed its incredible innovation, dozens of decentralized cryptocurrencies have been released by several parties. Some of the most popular and popular cryptocurrencies today include Bitcoin, Ethereum, Bitcoin Cash, Ripple, Litecoin, Dash, NEO, NEM, Monero and many more.
As we said, the history of cryptocurrencies is not very long, but it is certainly an interesting and eventful history. Now that cryptocurrencies like Bitcoin have proven their worth, their ability to function in the real world and have shown that they have real purchasing power, more and more banks, investment companies and Trade organizations, as well as retailers, have begun to accept them as legitimate forms of money and payment. The history of cryptocurrency is still unfolding as we speak, so stay tuned as there are always more developments to come.
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