Welcome to this post. Hopefully, all of you will be good and happy and enjoying your good health with the grace and blessings of Almighty Allah. This post is actually the homework post for Task 3 of the Season 5 of Steemit Crypto Academy. The lecture was nicely delivered by professor @awesononso. So, let's start our task without any wastage of time.
There are three tasks that are mentioned in the lecture post and we have to discuss only one of them as per the requirement of the professor. So, I am going to solve the task number 3.
Question : 03
What is a Cryptocurrency?
As we all know that we are living in the modern era of digital technology. Most of the daily-life items has been developed into their digital form. So, the same is the case with the currencies. The modern, digital and secure form of currencies is called as the cryptocurrency. The word 'Cryptocurrency' is basically a mixture of two words. One of them is the 'crypto' which means something like hidden, private, or secret. The other word is the 'currency'. So, the whole word referred to a type of currency that is hidden or private.
Cryptocurrency is the digital form of currency which can be used on different blockchains for purchasing or marketing purposes and which can not be felt or touched but can be used for all the daily-life purposes. It is based on the concept of cryptography. These cryptocurrencies are stored in blockchains in the form of blocks. The concept of blockchain and cryptography was first time given by Satoshi Nakamoto when he created the first-ever cryptocurrency, Bitcoin.
Our traditional financial system consists of currencies in the form of paper money, coins, or some metals but the Cryptocurrency technology consists of cryptocurrencies in the form of coins and tokens and the digital markets where these coins and tokens are exchanged, Exchanges. In the traditional financial system, the currencies and funds of the public are stored in the banks and that's why this is considered to be centralized.
Whereas, the cryptocurrencies are the decentralized financial system that do not have any central authority. Cryptocurrencies are not controlled or managed by someone. They are decentralized so they are under the control of the users only. The funds and transactions are under the control of the users and there is no involvement of any central authority.
The users of cryptocurrencies can store their assets in wallets and exchanges. Another concept related to the store of cryptocurrencies is the private and public keys. The private keys are used to log in to the wallet and sign transactions while the public keys are used to store the cryptocurrencies to the wallets.
Bitcoin is the first-ever cryptocurrency that was developed by Satoshi Nakamoto but it is a very strange thing that Nakamoto disappears from the whole scenery even after the great development of Bitcoin. A number of Altcoins are also being developed after the creation of Bitcoin and most of them follow the trend of the Bitcoin market.
In short, cryptocurrencies are the unique development of the financial system and it has seemed that cryptocurrency is the real future of the world.
What is Cryptography and how does it make cryptocurrencies secure?
Before going into the fact that what cryptography is in fact is, I want to discuss the meaning of the word 'cryptography'. The word 'cryptography' is comprised of two words. One of them is the word 'crypto' which means something like private, hidden, or secret. And the second word is the 'graphy' which means to put something into written form. So, the whole word gives the meaning of cryptography which is that to create some hidden or secret messages. These messages and the information are only accessible to the sender and the receiver.
In the blockchain world, cryptography is actually the base of the creation of cryptocurrencies. Cryptography is the art of transforming sensitive pieces of information into encrypted messages. These encrypt messages are only visible to the sender and receiver of the transaction. Whenever a transaction of cryptocurrencies is made, the information of the transactions is stored in the form of a message that is sent to the receiver's address.
As I have told you before that the messages are encrypted. So, this is actually the great benefit of cryptography. There is no involvement of the third party during transactions and the encrypted messages are not accessible by the third parties. The art of cryptography has made the cryptocurrency so successful that without cryptography, cryptocurrencies are blank.
As we have discussed the basic information about the art of cryptography. So, now we will discuss the process that how cryptography is helpful in the security of cryptocurrencies. So, have a look at the following points.
As the technique of cryptography turns the readable information into complex encrypted messages so these complex characters are only readable for the sender and receiver, making the assets secure.
The encrypted message is not readable for the third parties as it can only be decrypted by using the private key which is only available for the receiver. So, this thing makes the transaction of cryptocurrency secure.
The public key is used by the sender of cryptos to encrypt them while the private key is used by the receiver to decrypt the cryptos. In this way, a secure transaction is possible.
Explore the Steem Genesis Block and Sign in as proof of completion.
For the completion of this task, we have to visit the site https://steemworld.org/. The following steps must be followed to explore the Steem Genesis Block. So, have a look.
- First of all, open https://steemworld.org/ and open the Block Explorer menu.
- A new page will be opened and click on the OK option by selecting Block 1.
- You will see the details of the Steem Genesis Block as shown in the below screenshot.
The following information is seen in the screenshot.
|Timestamp||2016-03-24 17:05:00 UTC|
|Previous Block ID||0000000000000000000000000000000000000000|
- Now, click on the Sign In option, present in the top right corner.
- Now, enter your Steemit username and enter your private posting key and click on the OK option.
- You can see that you will be signed in to the website.
So, this is the method of exploring the Steem Genesis Block
Cryptocurrencies are digital assets that cannot be felt and touched but can be used for many marketing, trading, and purchasing purposes. Cryptocurrencies are based on the Cryptography concept which is all about encrypting information given by the sender and decrypting this information to the receivers by using the private key. Cryptocurrency is the future of the world financial system and is proved to be very profitable in many fields of daily life.
So, that's all about the Task 3 of the academy. Hopefully, all of you will like this post.