CRYPTOCURRENCY
INTRODUCTION
Cryptocurrency is a form of digital money and almost works like UPI but not as some as UPI. Before getting the concept of cryptocurrency, we need to know the concept of Money first!
CONCEPT OF MONEY:
Money is the medium of exchange, and it can be found in any form like notes, coins, and digital money. Notes and coins are controlled by Government, and Government can cancel any kind of notes by demonetization. For example, the Indian Government canceled the notes of 500 and 1000 in 2016 by demonetization. But this is not possible in the case of digital money.
CONCEPT OF UPI:
UPI is the Unified Payment Interface. UPI, i.e., an online payment gateway, is actually controlled by banks. Users need their identity verified and then set a private key, a password, and then they can make a payment or transfer money. And there is an 'e-ledger' controlled by banks and where all the transfer histories are recorded, and that information can be accessed by Government.
WHAT IS CRYPTOCURRENCY:
Cryptocurrency is a digital asset designed to exchange money, and there is no existence of any such notes and coins; it's virtual money. Users need a private key that is the password to make payments or transfer money. Users don't need any kind of identity proof or verification of documents. Moreover, they are not controlled by any particular state or country or any central bank, or any kind of bank. As soon as a person makes any payment through crypto, the information goes to millions of computers, and the information is stored there. And actually, all these processes are regulated through Blockchain Technology, which is highly secured. It is next to impossible to get the information or change the users' information from that. Simply speaking, access to the blockchains is impossible.
Though UPI and cryptocurrency are same to an extent, there are differences between these two.
(A) Control of Banks:
UPI is strictly controlled by the banks of respective countries. And in the case of opening a UPI I/D, the user needs their identity proof to be verified, and cach UPI has a private key that is generally called a password. And all the e-ledger and transaction history is recorded by respective banks, and that information is very accessible to the Government o that country.
But, in the case of crypto transfer, you need a password that is the private key, and no such identity proof and verification of transfer is needed in crypto. And as crypto is not regulated by any bank; or any country, none came to have the transaction history information. Moreover, the transaction procedure is done through blockchain technology. That is, when transferors put their password and send money, that information is sent to millions of computers. So, it's not possible to get the information of the user and the amount of money transferred.
Simply, crypto needs no I/D verification for transactions and wallets.
WHY PEOPLE USE CRYPTOCURRENCY:
1.whereas the real money is coming from banks, crypto is self-controlled, and so, there is no possibility of demonizing any crypto.
2. Government can not decided the value of bitcoin. It is self-controlled like gold and other valuable metals, of which value is decided on demand.
3. Identity of the owner is not found, which also leads to causing various illegal activities.
SHOULD YOU INVEST IN CRYPTO OR NOT:
Generally, people invest in things like a mutual fund, good, share market, and particular factors of the companies in the market that attract the value of share price. Also, there are most other practical things. So, the investor calculates those things and invests their money in the share market.
But, there are no such practical calculating factors; the whole market goes on hype. As you see, the price of bitcoin went high in 2018, and then it continuously falls to half of its all-time high value. Moreover, the value of a cryptocurrency depends on the demand in the market, and so, when an alternative comes, the value of other crypto goes down. As an example, Ethericum, Ripple have been affecting the price of Bitcoin.
AUTHOR'S OPINION AS AN INVESTOR:
As an investor, I never invest in cryptocurrency, But you can do daily trading to earn money, like interday trading.
So, that's the brief of the crypto market. Do invest in things that have practical factors and that you can calculate. The economy. You can surely transfer money through cryptocurrencies, but in the case of investment, thin Hope crypto market will become the next big thing, and it will help in the economy. K twice.
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