Happily for attending one more week of the crypto-academy, I have read your conference and I found the topic of the development of cryptocurrencies currently on centralized currencies very good, it was a nice job, next I will present my task, let's begin.
- 1. What is the fundamental difference between Cryptocurrency and the conventional financial system?
° The fundamental difference of cryptocurrencies and the financial system is based on the fact that cryptocurrencies are based on two systems both centralized that they are digital currencies under the supervision of entities that control their value and give rules for their use, much like the conventional financial system, but On the other side, we have decentralized digital currencies that do not have entities or rules that control them, so the big difference is their control, which in the conventional financial system, you have to follow orders, many times carry out paperwork to make transfers.
° Something positive about this system is that if someone steals your account or somehow enters your account and your money is stolen, the centralized financial system looks for a way to help you correct that error and since all transactions are recorded, it is much more easy to help you.
° This conventional system is also governed by the inflation of each country, there is an exchange control for different currencies worldwide and it is often a somewhat cumbersome procedure for many countries.
° Also about the transactions of the conventional financial system we can say that when we transfer a certain amount of money, the bank acts as an intermediary between account to account and there is a record of the transactions, many of these entities have transaction limits per day, and also they have limits on how much money you can transfer per day.
° The opposite of what happens with the decentralized cryptocurrency system, this is governed by smart contracts that do not need an entity for its transaction control since each of the transactions are automatically validated by miners, and the transactions are registered under the blockchain but in the name of a contract, the transactions there is no transfer limit and transfer amount.
° The only bad thing is that if you make a wrong transaction and have already confirmed it, there is no one to claim to return the crypto money since it is decentralized and there is no entity that controls the system, in the same way if you are scammed for any reason with a payment or something, you are responsible for your actions on your account.
° For cryptocurrencies it is very easy to change from one currency to another for a pair, and it does not affect inflation in them, it affects the volatility of some of them that are controlled through the market, supply and demand for buying and selling, This depends on whether a currency rises or falls in value, in addition to the fact that the transaction speed is extremely fast, whatever the amount, the speed will be almost instantly.
° Another and the most important difference is that not all businesses in the countries have at their disposal the acceptance of cryptocurrencies as a form of payment, because still many people do not have the knowledge about cryptocurrencies, otherwise the financial system is everywhere. The world accepts currencies from any country, performing the established conversion.
- 2. Why is a decentralized system needed?
A decentralized system would help a lot with respect to financial freedom that we have talked so much about in recent times, either because of the speed of transactions, because there is no entity behind everything, giving pretexts about any inconvenience of the account, we need the decentralized system so that we can make free transactions, at any time, to whatever account, without an established amount.
We need a decentralized system so that transactions are instantaneous, that we can have an easy and free exchange rate, so it would help a lot against inflation, against money shortages, against the rigorous system that some entities implement for issuance, transfer , and resection of fiat currencies, in addition to its security system to avoid scams, and above all the free transfer that we can make to any part of the world, especially to have free financial freedom worldwide.
- 3. What affects the value of cryptocurrencies?
The value of cryptocurrencies is always given by the supply and demand they have, if the purchase offer is greater than the demand in sales, the cryptocurrency will increase its value, if the opposite happens, it will lower its value, but it also depends Much of the reliability that many users have of the cryptocurrency since many times we have appreciated that through social networks, large amounts of ads about attractive things and disturbing things that will have a cryptocurrency in the future, this is called sentimental analysis, or marketing engineering, this is done by many large companies today as a form of strategy for their convenience, either to raise or lower a value.
Today we are seeing a lot this of the use of strategies, especially in social networks, an example of this is the businessman and billionaire elon musk, when he announces something good about bitcoin or dogecoin on his twitter, prices increase, and when he announces something bad the prices go down, it is because many people and small entities that have small and large amounts of money allow themselves to be manipulated by a person who is playing with their brain for their convenience, through this the reliability of the cryptocurrency falls a lot, another The factor is about the amount of cryptocurrencies that are in circulation, the amount that is burned in a time interval and its mining method, all these factors influence the value of a cryptocurrency.
- 4. Why can't everyone be a miner?
Being a miner depends on many factors, since it is a method that you necessarily need basic technical knowledge about cryptocurrencies and the multiple methods that exist for mining them, since to be a miner you need to solve blocks (equations, puzzles, numerical codes, etc. .) at a certain time, for this there are algorithms that are implemented in hardware that make the procedure much easier, since if it were done manually it would be impossible, since you have to follow a sequence and you need to be fast, to validate transactions From many parts of the world, not everyone can be a miner because many times they do not have the computing capacity required for such use, and they do not have the knowledge about mining, also because in many cases there is a large amount of energy consumption that entails a high cost of equipment, and the most important is that in many countries this system is prohibited, everything is about whether it is economically feasible for a person to be a miner or not.
- 5. Why can cryptocurrency transactions be called more transparent?
A cryptocurrency transaction is usually fast, safe and very easy to carry out for the enjoyment of the user, since the transactions work through a wallet that acts as a bridge so that the transaction of pairs, and this is registered in the base of blockchain data by means of a code, it will not have names and addresses, only a source and reception code and the amount, in addition, it does not require limits, or an entity that controls the exchange system or a schedule established for transfers.
To carry out a transaction you need the following 4 elements.
These are the address of receipt, or of exchange or return, of a transfer.
Each operation performed is recorded under a hash, unrepeatable under the block chain.
-Commission fee (Fee)
Fee is the payment given to miners so they can approve the transaction.
Despite the fact that in a centralized banking entity, the transactions that are generated from one account to the other are in privacy, there will always be someone on average who can see them, someone who has access to the entity's network that can see them, the transactions of cryptocurrencies everyone can see them by registering in the blockchain, everything is saved, with a number and what type of currency transferred. That is why it is very transparent.
- 6. Explain how the development of cryptocurrency in your country?
In my country Venezuela, there is currently a lot of mobility on cryptocurrencies since through the crisis that we are currently experiencing in the country, many of the Venezuelans have had to see the need to flee to seek a shorter social life. economic for the outside, and those of us who still live here because we have not been able to leave, we look for an economic solution for our family, in the streets there is still a lot of inequality on cryptocurrencies, due to inflation and bad strategies that the government has carried out, many People are ignorant of what is happening, many do not know the real value of the circulating currency yet, because it has increased uncontrollably, especially adults and elderly people who do not have knowledge about the exchange rate, much less know about cryptocurrencies and this system of digital currencies, there is a small field in my country that takes care of that, especially a small part of the youth who seek to save a little like You can to invest in some altcoin in the form of a hold and this can go up in the future, the rest of the government personnel is the one who handles everything related to cryptocurrency mining and the purchase of it, especially for money laundering, and be it for oil and the mining of natural resources such as gold and other precious minerals.
The only good thing about this country is that there are no restrictions on the use of cryptocurrencies, but there are restrictions on the mining of cryptocurrencies, since it is not possible to do so due to the heavy consumption of energy that they consume.
By the way, in my country the government implemented a cryptocurrency called "Petro" (PTR), this currency is centralized and would have the value of 1 barrel of extra heavy crude oil in the market, the president of Venezuela announced promising announcements regarding this cryptocurrency a couple of years ago, which was going to help in relation to inflation, that we were all going to earn decent wages through this currency, by the way the net monthly salary of each Venezuelan is 2 dollars at the exchange, the government placed all the paperwork of documents, (passport procedures, licenses, etc.), to be paid through this cryptocurrency, which can be purchased for the country's fiat currency at the price of a barrel of oil, an example is for the passport processing is You need the equivalent of 1 petro or the equivalent of 56 US $, this means that for a Venezuelan to acquire 1 petro, it would take the amount of 2 years and 3 months working without spending absolutely anything, this The petro cryptocurrency system in my country was all a money laundering, and a fraud since nobody uses it, and the government has not made more announcements about it or another cryptocurrency, it does not use resources for people to update themselves or anything .
Thank you for implementing this valuable topic of cryptocurrencies, since with this we can make known our knowledge acquired through the course and above all, what happens in our countries of origin, and everything related to its acceptance and use of cryptocurrencies, and using it digitally, I really had a lot of fun doing your homework, happy day, hugs.