Steemit Crypto Academy Contest Season 2 Week 1 - How Cryptocurrency has Shaped the Financial Realm. What is Its Future?

Source

OVERVIEW OF CRYPTOCURRENCY

Cryptocurrency is a Blockchain built digital currency which has no need for a third party or authority for transactions, cryptocurrency is an alternative to a conventional currency created with the help of encryption algorithms and secured by cryptography a mathematical algorithm used to secure sensitive data.
We can also describe cryptocurrency as a decentralized peer-to-peer digital currency that can be transacted, every cryptocurrency transaction is recorded on a distributed ledger that is distributed to every user in the blockchain for immutability.
Cryptocurrencies are digital currencies which means there can not be physically held and can only be received in wallets. Wallets are safe digital mediums through which we can receive or send cryptocurrency. Every cryptocurrency transaction carried out is stored in the blockchain which is a digital ledger where data(transactions) are stored in real time where they cannot be edited or altered and are linked across a network.
The first cryptocurrency to ever be created is called Bitcoin and it was created in 2009 by its founder Satoshi Nakamoto, the first transaction to ever get carried out in the crypto world was a purchase of two pizzas for 10000BTC. Cryptocurrency went mainstream a few months after that and a lot of different types of cryptocurrency projects have popped up, some of which include

ATOM
ETHEREUM
TRON
AAVE
LUNA
JOE

Draw a comparison between cryptocurrency and conventional currencies

VALUE: Initially in the earlier times when the concept of conventional money was brought up, it was created to serve as a means through which people could carry out exchanges be it for merchandise or service offered. Cryptocurrency is also similar in this case as it can be rendered in exchange for merchandise or service offered
BOTH UNSTABLE : Both conventional currency and cryptocurrency don’t have a fixed value for all time, In 2009 and 100$ was worth 14,000 in my country now a 100$ is worth 60,000 likewise for cryptocurrency when it was initially launched in 2009 (BITCOIN) it had a value of mere cents now its 30,000$. Yes one is more unstable than the other but the bottom line is they both don’t have a fixed value, it changes depending on how good the (crypto)market is or how good the (country’s)economy is
CANT BE DUPLICATED : Our conventional currency Cannot be duplicated because of each conventional currency has a designated EURion pattern or symbol incorporated in a number that makes it unique and no 2 currency have the same EURion symbol. Likewise cryptocurrencies each cryptocurrency is giving a designated hash and each is different from the other
DIGITAL: In these modern days most cases people can transfer conventional currency from account to account without having to hold physical cash likewise in cryptocurrency, both can be interacted with digitally

EXPLAIN THE DISTINCTIVE INNOVATIONS OF CRYPTOCURRENCY AND ITS DOWNSIDES.

DISTINCT INNOVATIONS of cryptocurrency are incentives we saw cryptocurrency introduced to the world upon its launch as an alternative method of payment.

• CRYPTOGRAPHY: Cryptocurrency is secured by cryptography which is a means through which data is encrypted to secure or prevent intrusion by third parties, in the crypto world cryptography often involves the use of two keys private key and a public key, one is used for encryption the other for decryption
• DISTRIBUTED LEDGER : The idea of a single ledger holding transaction from all across the world and distributing it to every node connected to the blockchain was strange until the introduction of blockchain, till today this has proven to be one of the most effective ways to prevent forgery of either transaction or record on and database because everyone has the same copy
• DECENTRALIZATION: Cryptocurrency was the first-ever form of payment system that runs entirely self-sufficient without any central authority controlling or a third party that can choose to deprive you access to your funds for a certain period whenever they feel the need to
• LOW CHARGES: Most individuals know how very expensive it is to send some money from one end of the world to another with cryptocurrency a fixed amount of charges going as low as 0.01% percent in some cases free is placed for transaction no matter how far or close the receiver is

DOWNSIDES

Scalability is a measure of how efficient a blockchain network is at processing transactions, blockchains like that of bitcoin which is a pioneer in all cryptocurrencies started with small block sizes which were only able to handle 5 transactions per second meanwhile centralized platforms like PayPal and Visa were already handling more around 1500-2000 transactions per second, that as we see it is a limitation that is encountered in blockchain it sometimes takes literally hours for a transaction to be completely finalized
Secondly, cryptocurrencies being digital currencies have no physical form and this implies that they are always in one wallet or another, this wallets cryptocurrencies are stored only have alphanumeric private keys and public keys which are a very difficult to commit to memory, once these details are lost or compromised one can not recover his account except he has his recovery key stored away. So when transactions are sent to the wrong address they can not be reversed and the owner of the address can not be in any way contacted for reversal, the downer here is quite a lot the keys are very complex and can be mistaken or can’t be committed to memory easily and every user in the cryptocurrency world could be anonymous
The blockchain trilemma is also a very big issue we have seen with the top cryptocurrency was their inability to achieve all three features comprising of Decentralization, Security, and scalability in most cases they each have to sacrifice one for two like our top cryptocurrency Bitcoin gave up Scalability for Security and decentralization.
We can see blockchains

How do you think major problems with Cryptocurrency can be handled?

Scalability is often determined by how clogged the blockchain is or how fast the blockchain gets its block verified before moving on to the next block, we know that in the case of Bitcoin each new block is created every 10mins and this is mainly due to the consensus algorithm practiced by the blockchain. For this to fix a new consensus algorithm that is as safe and as decentralized should be selected to hasten up the block generation process, Consensus algorithms like the Proof of History or the DPoS or a combination of any two can be adopted to the blockchain to help increase the scalability

The blockchain is entirely decentralized which means no one would have to divulge unnecessary information if need be but I believe that a community can be set up in charge of looking after its user's wallet, we have seen cases of people forgetting their wallet addresses and private key and due to this thousand of dollars worth of cryptocurrency have been lost forever. I believe this committee would go a long way to save a lot of people
They are at this stage of cryptocurrency multiple solutions to blockchain trilemma like the off-chain or the Multiple consensus algorithm solutions which I prefer. A combination of two blcochain consensuses like the POW and the DPOS can be used to eliminate the trilemma factor POW will focus on the Decentralization and Security of the Blockchain while the DPOS will focus on the scalability of the Blockchains network. A practical example of a blockchain using more than one consensus algorithm is the Solana Blockchain making use of the Proof of History consensus algorithm for speed and the proof of stake.

Do you believe in the future of Cryptocurrency? State your reasons. Any Recommendations?

Of course, the concept was only introduced some 13 years ago, and see how far it has come, many countries are making policies to accommodate the inevitable currency that might in a few years make our normal conventional currency a bit old-fashioned. In a few years from now, most people would have realized cryptocurrency is the future and will begin to get adopted not just in the financial sector in the health sector for things like data storage and payment service in the transportation and the educational sector practically all aspect of our digital life would adopt cryptocurrency in the very near future.
The possibilities cryptocurrencies have are limitless and its only a matter of time government will start adjusting policies and making room for cryptocurrency in the economy of its country, Crypto will change our lives for the better.

RECOMMENDATIONS
I would like to suggest a blockchain that has a way of confirming the receiver is created, in many cases users tend to send crypto to the wrong address, Every wallet address should have an option of adding a nickname or more like a tag or random username that ca be used for confirmation before sending, I believe with this the rate at which cryptocurrency gets lost will be reduced by at least 50%