Empowering Women in the Cryptocurrency Realm: Prema Chuttoo’s Educational Series for Womenlines Readers, sharing today about how cryptocurrency is changing the way we transact. Prema Chuttoo is a SAP Technical Consultant from Belgium and is a guest contributor at Womenlines.com.
Cryptocurrency Unlocking the Future:
Understanding crypto terms is crucial to be able to get a grip on what’s happening in the cryptocurrency world. I will explain the terms blockchain, Bitcoin, altcoin, hash rate, node, crypto wallet, private key, public key, and fiat currency.
The very first word is Blockchain, which comes to our ears every day.
- Blockchain is a chain of blocks containing specific data (database), but in a secure and authentic way together in a network (peer-to-peer). In other words, blockchain is a combination of computers(nodes) linked to each other instead of a central server, meaning that the whole network is decentralized. This is how blockchain works, no centralised data, all the computers in the system validate the information at every step. This is how we normally work, there is always a central computer which distributes the data.
- Node: A computer or device that participates in the operation of a blockchain network by maintaining a copy of the blockchain and validating transactions.
- Bitcoin (BTC):THE WORD! At first I thought BTC was what we call blockchain, I was referring everything to BTC and could not get a grasp of it.
BTC is the first and most well-known cryptocurrency, created by an anonymous person or group of people using the pseudonym Satoshi Nakamoto. To specify here, BTC is only a coin virtually which holds a monetary value, just like we have the coin Ethereum(ETH), and SOLANA(SOL).
Altcoin is any cryptocurrency other than Bitcoin. Examples include Ethereum, Ripple, Litecoin, and many others.
These are the icons for Ethereum(ETH) and USDT
To keep these coins on the blockchain (both terms defined above), a crypto wallet is needed.
- Crypto wallets store your private keys, keeping your crypto safe and accessible. They also allow you to send, receive, and spend cryptocurrencies like Bitcoin and Ethereum, just like a physical wallet.
- Next is the Private key — it is an alphanumeric code used in cryptography, similar to a password. It proves ownership or spend the funds associated with your public address. A private key can be a long binary code, 64 digit code or a QR code or a mnemonic phrase.
- Whereas the private key is private to a user, the public key allows you to receive cryptocurrency transactions. It’s a cryptographic code that’s paired with a private key. While anyone can send transactions to the public key, you need the private key to “unlock” them and prove that you are the owner of the cryptocurrency received in the transaction. The public key that can receive transactions is usually an address, which is simply a shortened form of your public key.
- Fiat Currency is a Government-issued currency that is not backed by a physical commodity like gold. Examples include the US dollar, euro, and yen.
- Mining is the process of validating and adding new transactions to a blockchain, that is how transactions are being processed in the blockchain. Miners use powerful computers to solve complex mathematical problems in exchange for rewards in the form of cryptocurrency.
- Hashrate is the computational power or speed at which a miner or mining network operates in the mining process (explained above), that is how control of processes is executed.
As you see each of these terms above is interconnected. That is how understanding becomes easier. These are the basic terms used in the blockchain and crypto world. It is very important to have a grasp of it so that we can understand furthermore terms.
Let me know if there is any issue understanding them, I will be more than glad to help you out.
Have a great read!
I am Prema Chuttoo, your guide in the crypto journey.
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