If you are really asking this then we suppose you are not aware of the very benefits of blockchain and cryptocurrencies. No worries! We are going to tell you about all that makes cryptocurrency the next big thing. The time isn’t far when everyone in the world would be using cryptocurrencies for daily use. Well, it is not that close too and we might now know whether it will vanish the use of cash or not but it certainly is going to bring massive changes in our financial system. You might find this unbelievable but the same was thought about computers and the internet decades from now. So, let’s get started and understand the reasons why you should use cryptocurrency.
What Do You Understand By Cryptocurrency?
You must have heard about “Bitcoin” very often because it was the first-ever cryptocurrency and was introduced in 2008. It became popular as a “purely peer-to-peer version” of digital money. Moreover, cryptocurrency is based on blockchain technology that is decentralized, transparent, and immutable. It is the blockchain, the technology behind cryptocurrency that makes it so valuable. As time is passing, more and more institutions are adopting blockchain to make their business fast, secure, and more scalable. To know more about Blockchain, read our guide “A Beginner’s Guide on How to Become Blockchain Developer after 12th Standard”
A cryptocurrency is a form of digital money that is backed by cryptography. When you say cryptocurrency, you must know it is virtual money and has no physical form. Cryptocurrency has so many benefits over physical money, for example, it can be used anonymously and spent worldwide.
Isn’t it amazing to know that something like this even exists?
8 Reasons Why You Should Use Cryptocurrency
Digital Money Is Much Safer
If you talk about the traditional digital payments, you need to own a credit or debit card in order to transfer your money. Here comes the role of third party i.e. bank. You have no option but to provide your sensitive financial information to them. But why take the risk when you have a better choice to go with? You don’t need the involvement of any third party as cryptocurrency is based on the decentralized blockchain.
Decentralization
As mentioned above cryptocurrency is not controlled by any central authority or association. There are only two parties that are involved in the entire mechanism, and that is the seller and the buyer. It is what makes it far more safe and secure than any other payment option and one of the major reason why you should use cryptocurrency over cash. Unlike Fiat currencies that are controlled by government banks and centralized authorities, cryptocurrency is not controlled by anyone except the owner. Hence the fear that your money will be devalued or inflated is gone.
Quick Transactions
Cryptocurrency is all about blockchain technology. Many companies are working on the same field to make crypto transactions more smooth and convenient. Cryptocurrencies let you transfer money anywhere in the world within a few seconds. It is believed that blockchain will facilitate cross-border payment by making the process less time consuming and costly. Although Bitcoin is still leading the race, every crypto is good in its own way.
Privacy and Security
Although, crypto transactions are publicly visible there are many cryptocurrencies like Dash that are offering private send features. Such cryptocurrencies promise you complete invisibility of data, which means your private details will not be revealed at any cost. Moreover, crypto transactions are immutable which means once processed there’s no way to revert it.
Portability
Bitcoin cannot be destroyed or defiled, unlike traditional currencies. Cryptocurrencies can be transferred from one corner to another corner of the world. Investors all over the world are trading crypto consistently. The varieties and types of cryptocurrencies are increasing and enhancing at the same time. In the last 4 years, the progress is unbelievably unmatched. People are realizing it at a slow pace that cryptocurrency has far more benefits than the fiat currency.
Less Transaction Fee
Compared with the paper currency the cost of accessing transactions is cheaper with cryptocurrencies.
Versatility
It can be utilized and obtained anywhere across the globe.
Volatility
Cryptocurrencies are highly volatile in nature. While you might think of it as a negative point, it is the only reason for the success of crypto trading. When bitcoin first came into existence, it was even worth a single dollar. Then within a few months, its price started rising quickly. It was after eight years, the price of bitcoin hit an all-time high at $20,000. Although the prices went low once again, it still has made significant surges.
The high volatility of cryptocurrencies is what makes it best for trading and investments.
The Most Popular Cryptocurrencies
Now that you know about all the reasons why you should use cryptocurrency instead of cash, let’s talk about some of the major cryptos. After Bitcoin, the first crypto coin which was introduced almost a decade ago, some other cryptocurrencies came to the market afterwards. Ethereum was also introduced in the crypto world after the need for new cryptocurrency mounted in the market. It was the very first alternative to bitcoin. ETH is a completely decentralized software platform. Presently, there are over 5,000 cryptocurrencies in the crypto space that gives you access to various features. Some of the top crypto coins are listed below:
- Ethereum (ETH)
- Ripple (XRP)
- Litecoin (LTC)
- Tether (USDT)
- Bitcoin cash (BCH)
Cryptocurrency Advantages In A Nutshell
The major reasons why you should use cryptocurrency are mentioned below:
- Not authorized by any central authority.
- No involvement of a third party. A transfer can be made directly between seller and buyer. Hence it reduces the risk of fraud.
- It is accessible to everyone
- No transaction limit
- Secure and Transparent
Credits cards work on a “pull” basis, in which the store pulls the desired amount from your bank account. Cryptocurrency works on a “push” system that provides the holder complete control on how much they want to send to the store or merchant.
Your Money, YOU OWN IT
There is no electronic system in the market yet that does not involve the other party. All the systems demand the participation of a third party besides the seller and the buyer. Let’s just take the example of PayPal: In any case, if the company finds out that some function has happened to your account, they have the vigour to freeze all the benefits of your account. Yes, it has happened with many users. They can even assess your funds. But with cryptocurrency, they provide you with your key. You can set the password and keep an eye on the entire system all by yourself. NO one can take it from you until you lose it yourself!
So, these were some of the major reasons why you should use cryptocurrency, In case you are interested to know more regarding it or blockchain technology, don’t hesitate to read more of our blogs.
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If you are trying to understand the science behind cryptocurrency, then you might also want to know about public and private keys. There’s no way you have never questioned yourself what is the difference between public key and private key, are they important or how to use them? In this article, all your questions will be answered. Indeed both public and private keys play a crucial role in sending and receiving cryptocurrencies and should be kept safe especially your private keys.
Many of us know private keys as a passcode that shield our crypto coins from going into the wrong hands. To process a transaction or to get access to your coins, one needs to enter the private keys. Only those who have access to your private keys can access your coins which is why you should not share it with anyone.
But what are public keys and what they do? You might now know but if you own cryptocurrencies or ever sent it from one wallet address to another, then you’ve used your public keys. How? Because even your crypto wallet address is obtained from your public key.
So, let’s get started and understand the working of both public and private keys in cryptocurrency.
Difference Between Public Key And Private Key
So, what the difference between public key and Private Key? This is simple, public keys are visible to everyone, however, private keys are kept secure so that only the owner of the cryptocurrency can have access to them. Both public and private keys work together in securing and processing transactions but are different from each other. Public keys are used to encrypt data or transactions, whereas private keys are used to decrypt the received data.
For example, if you want to send a secret message to Person A, you will use his public keys to encrypt the data so that no one else except him can read it. Then when Person A receives your message, he will use his private keys to decrypt it. This tells us that both public and private keys are linked. If a message is encrypted using Person A’s public key then it can only be decrypted using his private keys.
Is It Possible To Obtain Private Keys From Public Keys
It is true that both public and private keys are linked in a way that they work together. But if you are afraid that someone can get access to your private key using your public key then you can be at ease. There’s no way for anyone to obtain your private keys from public keys because the algorithm used in the creation of public key is only one way. However, you must save your private keys at a safe place so that no one else can get access to them or you end up losing it. Once, lost there’s no way to recover it and then your cryptocurrencies would be useless.
Understanding The Use Of Public And Private Keys In Cryptocurrency
Like we said above, both public and private keys are used to send cryptocurrencies from one wallet to another. Let’s understand it better with public key and private key example:
If John wants to send cryptocurrency to his friend Jake, he will use his public keys (wallet address). After that, he will use his private keys to authenticate the transaction and the transaction would be added to the blockchain. The receiver, who is jake, will also use his private keys to get access to the cryptocurrencies John sent to him.
This way, public and private keys together make sure that the data you are sending is being sent to the right person without any alteration. So, even if someone else gets access to your encrypted data, they wouldn’t be able to decrypt it without the private keys of the receiver.
Both keys exist in the form of long unreadable text and QR code. You can either scan the QR code or use the text as it is to process your transactions.
How To Keep Your Private Keys Secure?
Managing cryptocurrencies can be really painful especially when it comes to storing your private keys. Now that we have the clear your doubts regarding the difference between public key and private key, let’s move on to another question. So, where should you store your private keys that no one else can get access to them? All your mobile and computer devices have access to the internet connection which makes it really easy for hackers to get access to your private keys. Don’t ask me how they do it, just remember that it is just a matter of minutes for them to hack your device and extract data from it. Let’s talk about the various ways where you can store your private keys safe from hackers and every other threat.
Paper Wallet
This is the most basic way to store crypto private keys and no hacker can ever be able to get access to them. It is as simple as it sounds. You write down your private key on a paper and print the QR code and then keep it safe at someplace where no one else can get access to them.
However, there are many drawbacks to this method. In the past, we’ve seen many instances where people lost their keys, forgot where they kept it and dropped water on their paper wallet. You can simply write your the key on a piece of paper using the pen but then there are ink issues. Nevertheless, we recommend you should not use this method if you own a significant amount of cryptocurrencies. After all, it’s not a joke, this key is the key to your cryptocurrency and without it you literally have nothing.
Hardware Wallet
Presently, hardware wallets are considered as the safest method to store your private keys. There are no chances of anyone hacking your device and you can carry it with you anywhere. Moreover, hardware wallets itself are secured using passcode which is why no one can get past your wallet unless they know the passcode. It also allows you to enable two-factor authentication for another layer of protection. Some of the top crypto hardware wallets are Ledger Nano S and Trezor One.
At last, there are software wallets. As we said above, it is not safe to keep your private keys in your mobile phones and computers. So, we suggest you avoid this method. However, if you only have a meagre amount of cryptocurrencies and don’t want to spend your money in Hardware wallet, you should check out Reviews Of Best Multi Cryptocurrency Wallets With Pros And Cons.
