Not everyone is aware of the crypto terms like bitcoin, Ethereum, and web3 cryptocurrencies. They seem to the crypto world obtuse, opaque and strange. They cannot even imagine their functioning profile from their names. As the arrival of the internet world creates a bunch of opportunities for every trade, similarly, the blockchain and new technologies related to crypto bring so much change in the trading business. People are expressing the same kind of feelings like excitement, curiosity, scepticism and unexpected fear in the new world of crypto as they were facing at the initial time of the internet. Just go to https://cryptorobo.app/ and register for free to start trading Bitcoin.
People are not even aware that the main features of the technology are cryptocurrencies and NFTs, so here is a simple explanation about both, what they are, how they work, the mode of interaction between them etc.
What is blockchain?
Blockchain technology is a new way of data sharing and storekeeping of all in and out transactions of cryptocurrency. No company or group of people or intermediate is needed to control blockchain technology. It can be handled by a single user. This means aforesaid technology is best as compared to web3.
Blockchain is a hub of digital collection and its transaction record. In this process, an individual’s data is being recorded in the blocks and these blocks linked together to make the chain. Transactional history recorded in the blockchain is in the form of nodes. These are the hardware in the form of computers which secure the system by verifying all the transaction ledgers. All parties involved in the blockchain process must confirm the ledger. It is very convenient for hackers to have such systems like google or apple which were controlled by huge amounts of computers. But blockchain is safe as compared to them because its control is between one or two people. Therefore this technology is useful for decentralised data transactions.
Now let’s start with the type of data transactions known as cryptocurrencies and NFTs. Both are equally capable in one way however they are distinguished due to some reasons also.
Let’s start with cryptocurrencies.
What are cryptocurrencies?
Cry to currencies is a kind of digital currency. are digital currencies. The term cryptography is used to secure cryptocurrency. Cryptocurrency is highly protected in its way and it is not possible to counterfeit the cryptocurrency. Cryptocurrency is a firm of digital money which is stored in the blockchain in the form of an encrypted algorithm like a kind of public key pair. Although the cryptocurrency security level has its controversies yet its security protocols are quite famous. Digital coins are its form of digital currency also known as X-coin.
Bitcoin (BTC) and Ethereum (ETH)
Two types of cryptocurrencies named Bitcoin and Ethereum are well-known in the crypto market. But a separate blockchain system is used in their functioning. However, in time, the sands of cryptocurrencies have been introduced in the market with their blockchain platforms. The best practice to ensure the security of the ledger is to get the verification process covered by all parties. As the nodes of the system are secure the system will automatically be secure. platforms open sea and Binance are the two decentralised exchanges which are used to buy or sell cryptocurrency. OpenSea also allows buying NFT. To store this digital money, you must have a digital wallet. Although NFTs purchase is possible in crypto still there are many currencies preferred for trading and investment due to the volatile nature and the soaring v use of cryptocurrency.
What is an NFT?
NFT stands for non-fungible token. These are digital tokens like cryptocurrencies. These are a single and unique type of crypto which exists on blockchain as an asset. Only the difference between both cryptocurrency and NFT is Cryptocurrency is a digital currency which is used to buy digital assets like NFT. Therefore crypto can buy NFT but NFT can’t.
Conclusion
Cryptocurrency is fungible just like fiat currency which means it could be replaceable with any other currency of the same value. As these digital currencies are decentralised blockchains where no intermediate like a bank or government is required. Therefore their transactions are more streamlined and well efficient. But the side-effect is in case of data hacking, no third party can reimburse you if the transaction goes haywire. To overcome this problem, web3 is a valuable technology. Despite many pros and cons of crypto technology, it is like a revolutionary technology in its fantasy and these issues are continuously revolving around us.