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In
today’s world, Cryptocurrency is one of the most emerging digital assists for
exchanging money and other financial transactions. Through the use of this
technology, it will become easy to transfer assets and verify it. The value of
this currency increases over time. Through the help of ledger technology, it
will become easy to decentralize the control of each Crypto- currency. It can
be seen that blockchain is involved in serving as a transaction database for
the public. In 2009, the Bitcoin was released as the open-source software, and
it is considered as the decentralized Cryptocurrency.
During the evolution of this technology, many
users started to use this software and do their transaction through the help of
this technology. In this report, there is a proper discussion about Cryptocurrency
in detail by overviewing the history and evolution of Cryptocurrency. Followed
by this, then there is some information related to Bitcoin software technology
and the banks that are involved in giving these services to their customers. In
the last part of this report, there is some information about Cryptocurrency in
Pakistan.
History of Cryptocurrency
In the past,
one of the American cryptographer named David Chaum was using this electronic
money technology known as ecash. Then after this in 1995 this money is
implemented through Digicash. This was basically the electronic payment method
that was used in America. These payments were made through the use of software
for withdrawing important notes from the bank and then transfer it to the recipient.
After this, in the next year, NSA worked on this electronic currency by
describing this system in detail. Then according to this, new American law was
made for implementation. Later on, some publications were made on this technology
that describes b-money and electronic cash
The
next terminology was a bit gold that was explained by Nick. The bit gold was somehow
related to electronic currency, but it was in the form of gold. Then after
this, the new electronic cash technology was discovered, and it is also called
as first decentralized Cryptocurrency in 2009, known as Bitcoin by Satoshi.
This technology was using a cryptographic hash function. Then after this new
software formed to control this electronic cash technology. In 2014 the UK
government made some rules and laws for this Cryptocurrency and its
transaction.
Evolution of Cryptocurrency
For
proper information about Bitcoin, it is more important to learn about this
evolution in detail. This technology was first developed in 2009, and after
this proper work has been done. If someone like this currency, then he will be
extremely excited to know about its evolution in detail. This was created by a
software developer through a pseudonym. He was the person that has developed
the upgraded electronic payment system. This system was based on mathematical
proofs. This system was extremely cool and contained very low transaction
charges. After the introduction of Bitcoin, there were 100 other
Cryptocurrencies entered in the market. Due to this Bitcoin sold at a very
cheap rate and after this an alternative currency system was introduced named
as altcoins. Another alternative to Bitcoin is Litecoin, Ethereum and Dogecoin.
The main aim of
this Cryptocurrency is to create a safe and secure way to transfer money from
one person to another person, and maybe it is also indicated as ‘digital gold’.
In the start, there is a need in this technology. Then due to this, Satoshi
worked on new technologies like blockchain and Bitcoin transaction to attract
people. When blockchain was introduced, then more people started to use this
technology because whenever someone transfers Bitcoin to another person then is
time and date entered automatically. All of these entries are making history
about the data that can be used for the future. Now, this electronic payment
system is used around the world
Characteristics of Cryptocurrency
There
are some important three characteristics of Cryptocurrency are given below
Trust lessness of Cryptocurrency
For permission,
there is a need for the third-party grantee to value its assets. For the proper
transaction, the first party have to trust the third party; then it will become
easy to sell and purchase the product. The Cryptocurrency worked on removing
trust issues by developing a perfect network in which there is no chance of any
fraud
Immutability of Cryptocurrency
Through
the help of this technology, it will become extremely simpler to refer to the
history of banks accounts by just following these steps in detail.
The
bank is not involved in fabricating false transactions.
We
must have to trust the bank that it will always transfer that money to the
intended recipients.
The bank must
have to provide suitable security to its customers by securing their previous
records and not shared with others. It will secure every useful transaction
from the user
Decentralization of Cryptocurrency
It can be seen
that through the use of Cryptocurrency, no person is involved in affecting the
currency or minimize its importance. This Cryptocurrency is completely
decentralized and can be used to transfer payments from one person to another. This
currency will never be debased; it will always improve after some time
Terminology of Cryptocurrency
There
are a lot of terminologies of Cryptocurrency. All of these terminologies are
based on usage of Cryptocurrency all over the world. The currency that is used
in industries and on the other hand, the stock market will be at the top of the
list. Through the use of Cryptocurrency, it is so much simpler to combine
industries and stock market by using computer programming for transactions. From
all terminologies, there is some information about some important in the given
section
51% attack of Cryptocurrency
This means that
when there is more than half computer power on the same network is operated by the
same person, then there will be 51% attack chances on the network. The user is
unable to control the network, and it will also affect Cryptocurrency in a great
deal by minimizing transactions
AirDrop of Cryptocurrency
This
is basically the marketing campaign that is involved in refereeing fast
distribution of Cryptocurrency by people population. It will happen only when
its creator will allow its coin to rank lower. This strategy will increase the
value of Cryptocurrency.
Algorithms of Cryptocurrency
The
information stored in the computer program in the form of mathematics for
desired results.
All-time low of Cryptocurrency
This
is basically the low price that is ever achieved by Cryptocurrency
All-time high of Cryptocurrency
This
is the highest prices that are ever gained by Cryptocurrency.
Altcoins of Cryptocurrency
This
is one of the most famous alternatives to Bitcoin. All other Cryptocurrencies
like Ethereum come under Altcoins.
Bag of Cryptocurrency
If someone
has a large number of units of Cryptocurrency, then we will say it contains a
bag.
Bitcoin of Cryptocurrency
It is
basically the first Cryptocurrency developed in 2008. Then after this, it moves
towards more perfect computer programs and contains decentralized electronic
payment systems.
Block of
Cryptocurrency
The
blockchain is consist of many blocks. The main job of the block is to store the
historical data of every transaction of Cryptocurrency until its space is full.
It contains a complete record and will remain in it permanently.
Block height of Cryptocurrency
It
will give the information about how many blocks are attached in one blockchain
like if the height is one, there will be two blocks that made this chain.
Blockchain of Cryptocurrency
This contains
the complete information of all Cryptocurrency transaction from the users in
the form of block network. It is also called digital ledger. This is because
every block is present just above the next block like a network. Furthermore,
when information is overloaded in the block, then a new block is entered in the
blockchain. This blockchain repeated itself and saved into a number of
computers around the world. The best advantage is that there is no master copy
stored in each location.
Circulating supply of Cryptocurrency
The coins of
Cryptocurrency that is present in the public tradable space that is called as
circulating supply. These type of coins are unable for the public for trading
because they are burned or reserved
Cold storage of Cryptocurrency
This
is the term that is basically used for paper wallet.
Protocols of Cryptocurrency
This
is the main set of rules that will give information related to data exchange
over the network.
Public blockchain of Cryptocurrency
This
is a blockchain that can be accessed by anyone by a full node on their software.
Transaction of Cryptocurrency
The
coins of Cryptocurrency transferred from one person to another person by using
blockchain network.
Wallet of
Cryptocurrency
This is one of the most important terms in
blockchain because it represents the code that shows the address on the
blockchain. The address of the wallet is public, but it contains a private key
that is kept by the owner of the wallet. But it gives information about the
current owner balance.
White paper of Cryptocurrency
It
will give detail information about Cryptocurrency, like some technical
information about the coin with its detail purpose. This also contains
information about the road to success. It will also help the investors to
attract this currency.
Bitcoin of
Cryptocurrency
It is basically the first decentralized
Cryptocurrency, and it was discovered in 2008. It is also a digital payment
currency that is using an electronic method to exchange peer to peer currency.
This technology will also help to create and manage all Cryptocurrency
transactions. There is also one function in Bitcoin that is called P2P network;
it is basically an open-source network help to create and manage its
transaction.
Working of Bitcoin of Cryptocurrency
Its
working is extremely simple; the reason is that all payments are made through a
wallet application. The person that wants to transfer coin to another then he
just have to add address information and total amount then complete the
transaction.
Bitcoin mining of Cryptocurrency
Whenever
a creator wanted to make new Bitcoin, then it can be done through a competitive
and decentralized process known as mining. They are involved in processing all
transactions through a different software application. This will help the user
to give authority for the secure transaction to the user end.
Security of Bitcoin Cryptocurrency
There are some security issues that are
related to Bitcoin because many attackers are working on hacking Bitcoin sites.
This is the reason why this software contains proper protocols in which the
information will remain in each block of the blockchain. This is the reason why
Bitcoin is the first decentralized system.
Blockchain technology of Cryptocurrency
This
technology is one of the best for Cryptocurrency because it contains all
information related to Bitcoin. Through the use of blockchain, the user is able
to make a transaction without any difficulty. This is because there are about a
number of blocks are present in a single blockchain. Moreover, in the single blockchain,
there is a lot of wallets present. Each wallet is containing information
related to ownership. Through the use of blockchain technology, no person is
able to control the information.
In this technology, there is no master copy
that is the reason why the data will store in the database. The distributed
database is the main backbone of this technology, and it is also one of the
best features of blockchain. There are three technologies that combine together
to build the blockchain. These technologies are private key cryptography, P2P
network and protocols.
Quotes about Cryptocurrency
“The
practical consequence […is…] for the first time, a way for one Internet user to
transfer a unique piece of digital property to another Internet user, such that
the transfer is guaranteed to be safe and secure, everyone knows that the
transfer has taken place, and nobody can challenge the legitimacy of the
transfer. The consequences of this breakthrough are hard to overstate.” Said
by Marc Andreessen
Problems with Cryptocurrency
There
are some problems with Cryptocurrency due to this; it will become difficult for
the customers to trust on this currency. These problems are discussed in the
given section
Manipulation of price of Cryptocurrency
It is
one of the major issues of the Cryptocurrency market because of its excessive
volatility. The price of its coins increased or decreased in no time. Due to
this, the user is unable to predict the real-time to sell these bitcoins. In
the market, there are whales that contain large Cryptocurrency holding. These
members are able to swing the market, due to this the price of bitcoin will be
changed in no time. This will reduce the regularity of buying Bitcoins from the
market. This method will benefit the whales to gain more benefit
Pump and Dump ICO Schemes of
Cryptocurrency
It can
be noted that ICO schemes are the main part of the Cryptocurrency market. Through
these schemes, many tokens are introduced in the market. But in the
Cryptocurrency market, there is one problem due to pump and dump ICO schemes.
This is because it will reduce regulations, and the investors will feel
worthless with zero value
Transaction delay of Cryptocurrency
The
Cryptocurrency is using blockchain technology for transaction Bitcoins to all
users around the world. As time passes, the number of Cryptocurrency users are
increasing. Due to this, the record on the blockchain will be increased. This
means that the database of blockchain will be increased. During the transaction,
it can be seen that there is a huge delay after every transaction. In the large
blockchain, the transaction will be slow due to a large database. Due to such
delay action, many traders will face problem during the transaction.
The attacks of cyber attacks
The
hacker is attacking Cryptocurrency sites. Due to this, the value of the coin
will be reduced, and hackers will get more benefit. It can be seen from the
data of cybercrime of America. There are about more than 1 million coins are
stolen through hacking. Due to such hacking, the price of Bitcoins is reduced
and will affect Cryptocurrency at a great deal
Cryptocurrency in Pakistan
Pakistan
is also planning to use this currency in their country. In the past, due to
cybercrime issues, Pakistan’s government has put a ban on Cryptocurrency. Now
Pakistan is going to implement new Cryptocurrency regulations that will help to
track the records of any financial crime. This can be done by making new
regulations that will help to reduce money laundering issues and help to
regulate digital currency over the country. Pakistan is going to apply this
plan within this year by implementing new rules for Cryptocurrency.
Conclusion on Cryptocurrency
Summing
up all the discussion from above, it is concluded that Cryptocurrency is one of
the most emerging electronic cash technologies for the future. Through the use
of this technology, it will become easy to transfer assets and verify it. The
value of this currency increases over time. It can be seen that blockchain is
involved in serving as a transaction database for the public. In 2009, the
Bitcoin was released as the open-source software, and it is considered as the
decentralized Cryptocurrency.
If
someone like this currency, then he will be extremely excited to know about its
evolution in detail. For permission, there is a need for third party grantee to
value its assets. There are different terminologies of Cryptocurrency discussed
in detail with proper information. Later on, in this paper, there are some
problems related to Cryptocurrency are explained in detail.
References
of Cryptocurrency
Arvind Narayanan, Joseph Bonneau, Edward Felten,
Andrew Miller, Steven Goldfeder. Bitcoin and Cryptocurrency Technologies: A
Comprehensive Introduction. Princeton University Press, 2016.
Browne, Ryan. Five things that must
happen for blockchain to see widespread adoption, according to Deloitte. 1
October 2018.
<https://www.cnbc.com/2018/10/01/five-crucial-challenges-for-blockchain-to-overcome-deloitte.html>.
Chuen, David LEE Kuo. Handbook of
Digital Currency: Bitcoin, Innovation, Financial Instruments, and Big Data.
Academic Press, 2015.
Gerard, David. Attack of the 50 Foot
Blockchain: Bitcoin, Blockchain, Ethereum & Smart Contracts. David
Gerard, 2017.
Liao, Iuon-Chang Lin ； Tzu-Chun. "A Survey of
Blockchain Security Issues and Challenges." International Journal of
Network Security (2017): 653 - 659.
Lin, Iuon-Chang and Tzu-Chun Liao.
"A Survey of Blockchain Security Issues and Challenges." International
Journal of Network Security (2017): 653-659.
Meva, Dr. Divyakant. "Issues and
challenges with blockchain: A survey." International journal of
computer science and engineering (2018): 488-491.
Price, Dan. 5 Big Blockchain Issues:
Security, Privacy, Legal, Regulatory, and Ethical. 3 Oct 2018.
<https://blocksdecoded.com/blockchain-issues-security-privacy-legal-regulatory-ethical/>.
Tsaklanos, Taki. 5 Must-Read
Cryptocurrency Predictions For 2019. June 2019. <https://investinghaven.com/crypto-blockchain/5-must-read-cryptocurrency-predictions-2019/>.
Zheng, Zibin, Shaoan Xie and Hong-Ning
Dai. "“Blockchain challenges and opportunities: a survey”." International
Journal of Web and Grid Services (2018): 352-375.
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