This section will give a simple explanation of what cryptocurrencies are. It will also answer other questions that you probably ask such as how many cryptocurrencies exist in the world, what is the best cryptocurrency, what are the different cryptocurrencies or even what to choose between buying virtual currency and trading in cryptocurrency. A global phenomenon, cryptocurrencies are sometimes complicated to understand while the definition of a cryptocurrency is relatively simple.
Crypto currency simple definition
Cryptocurrency Definition – A cryptocurrency is a 100% digital and fully decentralized currency that is only traded peer-to-peer. All validated crypto-transactions are recorded on what is called the blockchain. The latter brings together the history of all operations carried out on its network since its creation.
Why is cryptocurrency interesting to use?
The principle of a cryptocurrency is to provide a monetary alternative for people who seek to regain control of their money by becoming their own bank. Some properties of crypto-currencies are revolutionary.
Among the characteristics of these 2.0 currencies, decentralization and peer-to-peer exchanges allow their users to no longer entrust their money to banks and to make transactions without an intermediary.
Thus, the central bodies no longer have control over the variation in the money supply of money (inflation vs deflation). They also cannot refuse or cancel a transaction, or even block funds, since they have no power over crypto-currencies!
They exist only on a computer network thanks to a computer code. There is no coin or ticket. Everything is done by computer. Like any other currency, cryptocurrency can be used to make purchases when accepted at merchants, send money to someone, receive money, etc.
There is no government or country that controls cryptocurrencies unlike traditional fiat currencies. The total money supply of a cryptocurrency is often limited. It is in this case determined at the time of the creation of the cryptocurrency and indicated in its white paper. Bitcoin’s money supply for example should not exceed 21 million BTC tokens.
The biggest contributor to the total present value of DeFi was MakerDAO , which developed stablecoin dai . The decentralized crypto investment platform Synthetic , the loan protocols Compound and InstaDapp and the decentralized broker Uniswap make up the majority of the remaining value in the open finance market.
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The DeFi market broadly addresses many of the most urgent financial needs (Image: Pixabay / geralt)
What does the DeFi market currently offer?
Today, there is a wide range of DeFi applications that provide much of what is provided by the traditional, centralized financial system.
From contractions and concessions to investments and insurance, the DeFi market widely supported by Ethereum meets many of people’s most urgent financial needs.
DeFi’s main offerings include:
- gaining profits on held cryptocurrencies has become easier than ever, thanks to the Compound protocol and dapps like Dharma and Celsius
- converting your ethers to other Ethereum tokens can be done safely and privately at decentralized brokers like Uniswap or IDEX
- hedging your crypto portfolio is possible thanks to decentralized derivative trading platforms such as dYdX
To make a transaction with a cryptocurrency, it is not necessary to use a trusted third party such as a bank or other intermediary to validate it. Transactions are made peer-to-peer via electronic wallets that are held on applications to buy crypto currencies, websites or even exchange platforms.
The fiat is under the control of central banks like the Fed (Federal Reserve) for the American dollar (USD) or the ECB (European Central Bank) for the euro (EUR). In the case of cryptocurrencies, all transactions take place on the blockchain. The latter acts as a general ledger open to all, transparent and tamper-proof. There are several protocols for validating transactions on the blockchain such as proof of work with miners on Bitcoin or proof of stake with stakers as soon as on Ethereum.
The term “crypto” of cryptocurrency comes from the principle that it is an encrypted currency. It can only be used by the person having the decryption code allowing to use the crypto-currencies present in a wallet for example.
Since crypto-funds use an advanced cryptographic system with a combination of private / public keys, your funds are safe. In addition, the blocks belonging to the blockchain (those which bring together all the validated transactions) are linked together by complex computer formulas that prevent any manipulation of the data.
The validation of transactions on the blockchain is much faster than most traditional players like Visa or SWIFT. Some transactions are validated almost instantly.
Now here comes Bustex.io with the best options for the mass. burstex.io happens to be the first crowd owned crypto exchange in the world that is built over the Burst blockchain. Not clear what it means? It shows that Burstex is now owned by the shareholders. They are the same shareholders who receive the profits from the collected trading, listing fees, and withdrawal. So are you interested to be a shareholder and take part in the trading process? It’s easy. The official Burstex token called BEX, is already launching on 15th June 2020. Staking on the Burstex will automatically turn you into a shareholder now. So what are you waiting for? Go with the best! Invest in the exchange!