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Cryptocurrency – Facts & Importance

The world is drastically evolving towards the new horizon of a digitalized ecosystem. From daily routine purchasing to business investments, from manual traditional payment methods to the online transfer of money, almost all businesses are moving towards paperless processes as well as digital currencies, and multiple projects are being worked on in this domain. Digital currency, also called cryptocurrency, is a source of the online exchange of value just like normal currencies.

What is Cryptocurrency?

A cryptocurrency is an advanced or virtual money that is obtained by cryptography, which makes it almost difficult to utilize it double-time or to fake it. It has decentralized networks of online currency dependent on blockchain innovation, which is an enforced distributed ledger by a network of multiple computers. Cryptocurrencies are frameworks that consider secure online payments which are designated as virtual or digital tokens, which are addressed by ledger entries within the system. “Crypto” alludes to the different encryption calculations and cryptographic strategies that defend these entries, like key pairs of public-private keys, hash functions, and encrypted elliptical curve.

Programming Features in Cryptocurrency:

The programming features that are used in cryptocurrency development include the following that together makes-up a complete flow of cryptocurrency.

 

1. Pointers:

Pointers store the address of the variable in a programming language. In the language that does not support pointers like Java, references (implicit pointers) can be used to call a specific function where you can call an address by referring to it.

 

2. Linked Lists:

It is a block sequence of data that is linked to the next pointed block. In the blockchain of a cryptocurrency, it contains information like a hash of the previous block, time, version, the target, and the Markle Root hash, etc.

 

3. Memory Control:

The memory control feature helps to efficiently implement the function of consensus in blockchain that means all the blocks must accept or reject a certain specified block. It plays a crucial role in the online service of a cryptocurrency that is an ongoing process.

 

4. Threading:

Threading assists in the integration of parallel & non-parallel transaction nodes to provide optimized performance.

 

5. Copy & Move Semantic:

The feature of copy and move semantics reduces the redundancy up to a greater extent in a blockchain sequence.

 

6. Polymorphism at Compile Time:

By the polymorphism at compile-time, one feature can be used in more than one way while a transaction is being processed via function overloading along with overloading of operators.

 

7. Code Isolation: 

Code isolation refers to unique code like using namespaces in C++, packages in JAVA, etc.

 

8. Maturity:

With the continuous updates of a language to overcome the real issues during debugging and analytics, the base of cryptocurrency keeps on updating, and thus, maturity of the language is obtained.

Working of Cryptocurrency:

 

1. Transaction Begins:

In our normal routines, any customer or money holder transacts money via internet banking or directly pays hard cash to exchange any value. Similarly, a cryptocurrency holder begins the process by requesting a transaction.

2. Peer-to-Peer Network:

Cryptos can remove the agent, as the blockchain network is not constrained by any entity. It is similar to a network organization that has libertarian affinities. The transaction is communicated to a Peer-to-Peer network composed of PCs that are called nodes.

3. Validation:

When a transaction is communicated to the network of organized nodes, the very next task is to validate the transaction along with the status of the user with the help of a pre-defined algorithm of the system.

4. Verification:

A successfully validated transaction by the node network is then verified with the information that is specific to that cryptocurrency, records, contract, or other relevant information.

5. Post-Verification Process:

After the verification of the transaction initiated by the user, the next step is to maintain its proper ledger. The post-verification process includes the under-mentioned activities.

a. Generating New Data Block:
The verified transaction is then integrated with the other transactions in the cryptocurrency ledger to generate a new data block.

b. Adding Block to Ledger:

The newly generated block of the transaction is amalgamated into the existing blockchain that is static and cannot be changed anyhow.

6. Completion:

After the amalgamation of the newly created block of transaction data into the blockchain, the transaction is finally completed.

 

 

Features of Cryptocurrency:

  • A characterizing feature of cryptographic forms of money is that these currencies are not issued by any focal position, the central authorized entity that’s why delivering them is hypothetically invulnerable to government obstruction or control.

  • These currencies have no intrinsic value that is not redeemable to another commodity such as gold.

  • It has no physical existence and is present only in an online virtual network of computers.

  • Its supply is not determined by a central bank and the network is completely decentralized.

Importance of Cryptocurrency:

 

1. Safety & Security:

The main and most focusing importance of cryptocurrencies is that these are the most secured and safe currencies available online. Cryptocurrencies ensure a safer and more secure way to invest money online and to conduct any transaction freely. It has a strong hashing algorithm for security that helps the digital currency’s security fool-proof.

2. No Third-Party Interference:

While conducting an online transaction, there is no involvement of third-party like banks or government, etc. as included in the policy of cryptocurrency. The network of cryptocurrency alleviates the presence of a third entity, irrespective of the country where you are across the globe.

3. Low-Cost Transactions:

While exchanging the value of the cryptocurrency, the cost of the transaction is comparatively very low. The user is just required to input basic information regarding cryptocurrency while initiating a transaction.

4. Charge-Free Safe Wallet:

Cryptocurrency also frees the user from the cost of keeping the money in his wallet, unlike a bank that charges money to keep your money in your account. Wallet of cryptocurrency is safer facilitating its users by providing space free of charges and it can easily be transferred to your account.

5. Privacy:

Privacy is the primary foundation of cryptocurrency. It is a strongly secured and hashed transaction process that pays high attention to the user’s confidentiality as it is the top-most priority.

 

6. Liberty of Fractional usage:

Cryptocurrencies can also be bought as infractions as it has the liberty of fractional usage. This increases the flexible utilization of cryptocurrencies and investing them in business processes and trade purposes.

 

7. No need to share credentials:

The initiator of the transaction (sender) and the receiver of the cryptocurrency do not interact with each other directly, it is crucial to keep the credentials of digital currency secure as transactions are autonomously requested. The security network allows the user not to share the credential to proceed with currency transfer.

 

8. Autonomous control over your value:

As there is no third entity involved in cryptocurrencies, the users have complete autonomy and no one can charge any fee. Users individually manage their respective accounts.

 

Cryptocurrency in Pakistan:

State Bank of Pakistan (SBP) has previously said that SBP has neither granted license nor authorized any entity to deal in cryptocurrencies (Virtual Currencies). SBP has published a circular on its official site that denies all kinds of digital currencies to be used for any transactions like business trade, purchase payments, etc. But in a recent interview with the CNN channel, Governor of State Bank Pakistan, Mr. Reza Baqir said that digital currency is under study by the central bank. It was the first time when any SBP official said they are studying cryptocurrency in Pakistan

Final Words:

During the last few years, cryptocurrency has gained rapid public attention. State Bank of Pakistan has said that they are studying cryptocurrency and would introduce a rate policy to accommodate interest. Cryptocurrency is under study by SBP and it is expected to bring cryptocurrency in financial inclusion. Since digitized currencies would drastically alter the way of sales and purchase if officially introduced in Pakistan and would surely help every business sector and appeal dynamic investments for different projects and services from multiple investors within the country and abroad as well.

Asiya Mazhar

Author

Asiya is an experienced & proficient software engineer. Being Project Coordinator at CodeLabs, she is responsible for managerial tasks dealings and coordinating for software projects.

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