What is trade? Have you ever wondered what created blockchain and how it came to be? Have you ever wondered what crypto is and how it came to be? Have you ever wondered which one came first, blockchain or crypto? The answers to these questions form the basis of blockchain and crypto’s concept.
Trade is one of the main contexts from which blockchain could be looked at from. So, the definition of blockchain in this context is - the culmination of the transactions made between the manufacturer and buyer. It is used to keep track of the transactions and its main goal is to avoid any disputes between the manufacturer and buyer. Blockchain is a ledger of transactions maintained digitally, each time a transaction is made, a new block is added to each participant’s ledger, carving a place for a decentralized database known as Distributed Ledger Technology (DLT).
Well, after reading about blockchain, if you’re wondering what does crypto have to do here?
Here we go:
Crypto, or otherwise known as either cryptocurrency or Bitcoin, is decentralized digital money that works on blockchain technology. Blockchain is the underlying technology that enables Bitcoin and other cryptocurrencies to exist. There are multiple forms of crypto, other than Bitcoin, some of them include Etherum and there are more than 19,000 different cryptocurrencies in circulation, according to Forbes Advisor. According to euromoney.com, Libra is the cryptocurrency that Facebook launched after numerous efforts.
Bitcoin is known to be one of the successful ventures that tried creating a form of cryptocurrency through the use of a blockchain.
Blockchain is important! Why? What are some of its uses? How does it work?
Blockchain helps eliminate the usage of paper to keep track of an individual's transactions and it helps to remove the need of a central authority because each person can have their own blockchain.
A blockchain is created when someone requests a transaction. The requested transaction is sent to a P2P network (peer to peer), a network of computers, known as nodes. This network of nodes validates the requested transaction and user’s status using algorithms, since it's done automatically by the computer. A verified transaction can involve cryptocurrency, contracts, records, or other information. Once the transaction gets verified, it’s combined with the others to create a new block of data for the ledger. This block is now added to the existing blockchain, in a way that it cannot be altered or faltered with. Finally, the transaction is done!
Proponents of blockchain are currently testing out some other potential uses of blockchain and they include:
Management of fractional ownership with autonomous cars using blockchain
Removal of middlemen to increase the speed for billion dollar transactions to take place easily & also decrease the number of financial frauds
Can also be used in voting, constituents can cast a vote using a blockchain code via their smartphones, tablets, or computers. This results in immediately verifiable results.
Can also be used in healthcare systems with each patient’s information getting encrypted and shared within the system without a privacy breach.
Source: Making sense of bitcoin, cryptocurrency and blockchain.
Supporting Cluster Post to Include:
Cryptocurrencies are enabled by blockchains! How?
Cryptocurrency is any form of digital money or virtual currency. It works on blockchain technology. It is because of the security that the usage of blockchain has, has made it possible for cryptocurrency’s operations to take place even without a central authority. Bitcoin is believed to be the first and original form of cryptocurrency. It was created in 2009 by a certain Satoshi Nakamoto, it was believed to be a person or a group of people under a pseudonym. Bitcoin is considered to have been developed during a new age of blockchain technology and decentralized digital currencies.
Bitcoins, in recent years, have become very popular. Bitcoins can be traded and there are about 14 million of those in circulation, at the present. Bitcoins are designed to work as a medium of exchange online that are used to buy goods and services, and make payments.
Now, what makes cryptocurrency so different?
Cryptocurrencies have not only become popular, but have also opened the doors for other forms of online trading and marketing. Cryptocurrency is decentralized, as stated earlier, and is free from any third party interference. There is no limit of access to the amount of crypto you own, you can use it anytime and sell it anytime, you’re free to do whatever that’s legal with them. There are no extra charges on making international transactions.
Cryptocurrency has opened the door for the following technological possibilities:
Creating smart contracts that automatically enforce a contract
It enables the usage of smart property via blockchain
Helps with notary services that proves that a certain document existed sometime back
Helps with bonded identity services that secures identity through blockchain
Fun fact!
The “crypto” in cryptocurrency stands for cryptography which is a method of using encryption and decryption to secure the data in the presence of any third party with ulterior motives.
Another one!
Cryptocurrency uses the SHA-256 hash algorithm.
Cryptocurrency’s Impact: large financial corporations are investing in cryptocurrency!! For example: PayPal.
Supporting Cluster Post to Include:
Web3 - A wave of internet crypto
Web3 sounds fancy doesn’t it! Well, it’s a type of internet browser as its name suggests… and we do know that internet browsers are fancy because they give us access to all the resources that we need online just a tap or two away with a couple of types.
Let’s get to know a little bit about web1.0 and web2.0 before web3.0…
Web1.0: in 1991, the internet was only on read-mode, it did not have the features of logging in into a website to make changes, or edits. So, when you load the internet a bunch of static pages would load and upon clicking on those, you would get to a page of some content, which did not let you make any changes to those. This type of old-internet could be termed as a huge Wikipedia page with a bunch of hyperlinks linked to it.
Web2.0: from 2004 to now, the internet has evolved a lot. Not only did we receive information from pages, but this time, pages also received information from us. As we searched for information on websites, centralized firms collected our data to make better content, which then increased their audience as their demands were being met, thereby also bringing them more money. They sometimes could also sell their data to other companies for money. This age of the internet is sometimes known as the age of targeted advertising and the lack of privacy.
Finally, web3.0: this is the latest evolution of the internet utilizing blockchain technology and the tools to decentralize. In web.20, you were the product as you were utilizing the online networks, while in web3.0, it is believed that you will be the owner of your content through the stuff that you post online. You have full control over your data.
Ex: Odyssey is a blockchain alternative to youtube where videos can be posted and creators can earn library tokens, rewards for attracting more viewers. A downside to this is you can’t stop a video from being posted, so if someone in the network wants to watch it, they technically have to download the video and then share it to the people who want to watch it, thereby creating a torrent network. In other words, even if you take a video down from some social media, it’s not completely erased from the network because there might’ve been some user who would’ve downloaded that video before you took it down, thereby not disrupting the blockchain network.
Through web3.0, companies might get to a point where they all have a decentralized network running it called - Dao (Decentralized Autonomous Organization). This means that there are no CEOs or Presidents to impress, most of these companies get their changes through shareholders, who make charges by voting. There’s no censorship in web3.0. Your digital world identity is not 100$ connected to your real world identity. Basically, your identity is not being revealed when you download and post content anywhere. Dao removes the “middle-men''
Finally, the reality of web3.0 is that in the future you can buy Amazon gift cards using Metamask and get your money or change back in the form of Ethereum.
IMAGINE YOUR ONLINE SHOPPING RUNNING WITH CRYPTOCURRENCIES!!!!!?!!?!?!? CRAZYYYYY!!!
Web3.0 Foundation - a company that supports projects for increasing decentralization on the internet. The following are their three main projects:
Blockchain Polkadot
Polkadot’s Test Chain
Web3 Summit
This summit grants offers which most of them have to do with the Polkadot Blockchain.
This in simpler words is one dozen owning the other!
AI + WEB3.0 = the future combination!
Web3.0, according to some sources is no less to metaverse, which is an idea of a supreme internet with high-end technology.
Some examples of web3 in practice:
Bitcoin - the original cryptocurrency
Steemit - blockchain-based blogging
Web3.0, according to supplain.io, can return content rights to authors and build a new digital economy, which people lost while using web2.0.
Sources:
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Nivriti Deshpande
10th Grade
Bentonville