Blockchain and Cryptocurrency Beginner - How Cryptocurrency has Shaped the Financial Realm - Overview of cryptocurrency

Before we proceed to the main topic which is How Cryptocurrency has Shaped the Financial Realm, let's first take a look at the overview of cryptocurrency as that will serve as a foundation to see how it has help shaped the financial system.

Overview of cryptocurrency

Since the invention and introduction of blockchain technology and cryptocurrency, the financial realm has seen a massive change in its operations and how transactions are made. However, before I delve into how cryptocurrency has shaped the financial realm, let me first give a brief overview of cryptocurrency and what it is...

The term cryptocurrency basically refers to digital currency that runs on the blockchain. As a digital currency, it means that it can be used as a store of value like bitcoin or to send and receive money from one person to another in any part of the world or as a medium of exchange faster without any third party interference or barrier. Bitcoin was the first ever cryptocurrency to be created that runs on the blockchain (bitcoin blockchain). Cryptocurrency transactions are recorded on the blockchain.

These cryptocurrency transactions on the blockchain is transparent and cannot be altered or changed. In other words, once a cryptocurrency transaction is recorded and stored on the blockchain, it immediately inherits the benefits of the blockchain. Cryptocurrency has seen a massive growth since its inception few years ago and has since achieved massive adoption. While cryptocurrency is a digital currency that is used as a medium of exchange or store of value, it has grown to be much more.

At the moment, the main types of cryptocurrencies are tokens or coins. Tokens are cryptocurrencies that can be created without the need to create its own blockchain and can be deployed on any blockchain that supports token creation such as ethereum blockchain etc. Creating tokens is a lot easier as there are tools that make it easier to create and deploy tokens on certain blockchains. Coins on the other hand are the true cryptocurrency that runs on its own blockchain such as bitcoin, ethereum, litecoin etc.

Unlike tokens, creating a coin is much more difficult as it requires high level technical skills and proper understanding of blockchain technology and cryptocurrency, and also a blockchain to be developed before the coin can be created. Now, cryptocurrencies can be used in more advanced ways aside digital currency to send and receive money or make payments for goods and services.

Cryptocurrencies has proven to offer a lot of benefits compared to the traditional and conventional currencies such as paper money. In the next section of this post, I will be drawing out some of the comparisons in regards to the benefits of cryptocurrencies compared to the conventional currencies…