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Hi steemians,
Welcome to the seventh and last entry of mine in this week's engagement challenge. It has been an interesting week as we start on very good ground with season 6 of the engagement challenge. I'm delighted to have participated in all the entries for this week's challenge.
Welcome to the seventh and last entry of mine in this week's engagement challenge. It has been an interesting week as we start on very good ground with season 6 of the engagement challenge. I'm delighted to have participated in all the entries for this week's challenge.
As usual, this week the steemit crypto academy has once again presented us with a very powerful contest titled The Blockchain Revolution. Revolution talks about changes that blockchain technology has brought in our digital economy and every aspect of life. I will be attempting the questions below as a sign of my participation in the contest. Let's get started.
Explain in your own words how Cryptocurrency have brought a revolution in the digital economy
Cryptocurrency came into existence in the year 2009 with the invention of Bitcoin. This is a digital currency that makes use of cryptography technology when it comes to the security of the asset. Cryptocurrency just like normal fiat is used to buy goods and services. This means that anything that normal fiat can acquire, you can also acquire via cryptocurrency.
One of the changes that cryptocurrency has brought to the digital economy is that it eliminates the interference of third part I.e it is a decentralized form of currency which is not regulated or controlled by the central bank or any other third party. The decentralized nature of cryptocurrency gives users more control over their assets because they are solely in the hands of their owners.
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To use cryptocurrency, all you need is a smartphone or a laptop with an internet connection. You also need a wallet which is a place where your crypto asset can be stored. As I have pointed out earlier, having your asset in this wallet makes you the sole owner since you are the only person that has your private key or password as the case may be.
Talking about the revolution that crypto has brought to the digital economy, we have seen how the spread of crypto has been since it came into existence in 2009. Today we have thousands of different crypto assets. Big firms and companies today have diversified their means of payment to allow more customers to patronize or reach out to them. Any company that accepts all forms of payment (I.e fiat or crypto) grows faster than any other.
You will agree with me that crypto is been adopted in every aspect of our economy today despite many government regulations against it because they don't have control over it. Today we have the privilege to monetize our content by posting quality articles on steemit and other related social media platforms which were not so many years ago. Indeed, cryptocurrency has brought many revolutions in the digital economy because since the entire stuff started in 2009, the digital economy has never been the same.
How is Cryptocurrency a revolution and which technology is used to run the process of cryptocurrency?
Revolution as I have started earlier means change. Cryptocurrency has brought a lot of change to the digital economy. Before this time, no generally accepted currency is used globally but with the coming of cryptocurrency today, we can make use of crypto assets anywhere at any time. Assets like steem can be used here in Nigeria and are still used in Pakistan. This is not the same for native currency like Naira used in Nigeria.
More also, the transaction of this asset all over the globe is simple and easy. You can perform the transaction of both buying or selling in the comfort of your home. Once you have an internet connection and a wallet holding this asset you can make your transfer and the person receiving doesn't need to change it to use it. Since the person accepts crypto too.
Another reason why I said cryptocurrency is revolutionary is that it is a decentralized form of currency where you have full control of the asset provided you alone have the private key or password. It has no limit when it comes to the time or amount of assets you wish to perform your transaction.
With cryptocurrency, a lot of gaps which was initially seen with our normal fiat and native banks have been bridged completely. No one has details of the number of assets you possess because the technology doesn't leave a trace of that. Though transactions recorded can be seen by all since it uses cryptography, the identity of the user is left hidden.
Which technology is used to run the process of cryptocurrency?
The technology used to run the process of cryptocurrency is blockchain technology. Blockchain is a technology used for the storage and sharing of data of transactions in a peer-to-peer interconnected node. Data stored on the blockchain cannot be edited or changed unlike the centralized system's data can be edited at any point in time. This very aspect of this technology made it more unique and outstanding.
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The blockchain is where all the records of transactions are stored in a form of a block. This means that each transaction has a link to another since they are stored in a block. You can trace a transaction because of the link it has as it is validated and connected to the previous block. With this, we can move back to the first block called the genesis block.
What is the main purpose of blockchain technology and can this blockchain work without an internet?
The main purpose of blockchain technology is to eliminate third parties, provide security, record all transactions in a decentralized ledger and also reduce the cost of transactions. Blockchain is very secure because all transactions are verified before they can be added to the block. To highlight more, the purposes and benefits of blockchain technology can be seen below.
- Decentralization (effective running of nodes).
- Transparency (everyone sees all).
- Immutability (data not editable).
Decentralization: This is one of the main purposes of blockchain technology as it allows users to perform their activities without any interference from a third party. Here, you are the sole owner of your asset and hence you control the entire transactions.
Transparency: Another purpose of blockchain technology is transparency. Every activity within the blockchain can be seen by all as all transactions are made visible to anyone and anywhere around the globe. No form of faking it since everyone can see the happenings.
Immutability: Blockchain keeps a record forever. This means that the record stored in the blockchain can not be erased or edited. This gives the blockchain more integrity as the transaction recorded today can not be seen changed the next day.
Can this blockchain work without an internet?
Yes, blockchain can work without the internet. It is important to mention here that we have two types of blockchain I.e the private blockchain and the public blockchain. In the case of the private blockchain, it can work without the internet whereas, whereas the public blockchain must be connected to the internet for it to work effectively.
The private blockchain can work without the internet being restricted within a given firm hence it can not be used in a wider geographical location and can not be used to hold much data as it is in the case of the public blockchain which covers a wider range and uses the internet to connect people from all over the world.
Explain in your own words how blockchain generate cryptocurrency. Is all cryptocurrency based on blockchain? Explain
Blockchain uses a mining process to generate cryptocurrency. We are aware that blockchain is a digital ledger used to store transactions such that it can not be further edited. The blockchain contains blocks where the transactions are verified and recorded with each one having a link to the other.
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With the help of blockchain, transactions are more secure. Now, whenever miners verify and add a transaction to the blockchain they are been rewarded with new tokens (newly minted) and this serves as their reward for the job well done.
Verifying these blocks can be in any of the consensuses algorithm formats I.e proof of work, proof of stake or even proof of brain etc. Sometimes we may need a sophisticated complex computer to solve some mathematical equations to get the token as is in the case of POW. Others are based on the amount you have as a stakeholder in the company I.e POS, you are having more control over the mint of new tokens in such a case.
Is all cryptocurrency based on blockchain? Explain
No, not all cryptocurrency is based on blockchain some cryptocurrency is based on smart contracts and a very good example of such a cryptocurrency is Ethereum. Notwithstanding, most crypto we have today is based on blockchain based on the security and the benefits associated with the technology.
I have stated earlier that transactions are stored in blocks and these blocks have links to one another hence you can be able to trace the origin of each block because of these connections. This makes it more difficult to have an issue of double spending. More also, in the blockchain before implementation, the majority must agree.
Explain some of the challenges face when implementing Blockchain technology
Blockchain technology has some challenges associated with it when it comes to its implementation and one of these challenges is acceptance. Before a census will be reached, the majority must have accepted the system and that is where the major issues of blockchain are.
There are a few more reasons which I will be listed below as some of the challenges faced when implementing blockchain technology. Let's look at them below.
Lack of knowledge of the technology: This is a major issue that limits the implementation of blockchain technology. A lot of people out there don't understand how blockchain works and for that reason accepting and using it is a problem for them.
The issues of blockchain trilemma: It is always difficult if not impossible to have a blockchain that has the trilemma features that are needed by all I.e decentralization, scalability and security. Most times a blockchain we have two of these features but those needing its function may be needing the third feature as well.
Cost of adoption and regulation issues: The cost of using some of the blockchain platforms is quite very expensive and this makes the adoption of this technology difficult in most cases. Another is the lack of regulation and governance which can lead to fraud by some users who get access to your account.
You will agree with me that the blockchain revolution has just started and with a little time, it will escalate as anticipated. The digital economy today has become even more secure and transparent during operation because of the presence of blockchain technology. Cryptocurrency is indeed the future and with time it will take over the traditional currency we use since it has some limitations. The beauty of blockchain technology it's is its immutability features which have made a lot of bigger bodies adopt it today.
Thank you, friend!
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Your post has been successfully curated by our Team 5 via @malikusman1 at 45%. Continue making quality content for more support.
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Thanks @malikusman1
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Although blockchain was originally designed to process transactions, it has become a valuable tool for industries outside of cryptocurrency, including supply chains, title registries, voting systems, and more.
Of a truth, blockchain trilemma is another challenge that can be encountered when implementing blockchain to a system. For this reason, they have been layer-2 scaling solutions to help solve the issue, which remains a challenge till now.
Generally, you have written well, and I wish you goodluck in this contest.
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As always, you have presented a very beautiful and informative post. I liked the way you presented your understanding about the Revolution of the blockchain technology.
There are many unique qualities that the Blockchain technology have and are very much beneficial for the smooth running of the financial system. Many of the problems that were present in the traditional financial system has been sorted out by the implementation of the Blockchain technology.
Yes brother, you are very right here. We all know that nothing is perfect in this universe. The Blockchain Trilemma has always been a disturbing factor for the Blockchain developers as they have to sacrifice one of the three impressive features.
Thanks a lot for sharing your beautiful post with us and wishing you a very happy contest ahead.
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I agree with the point that most of the people still don't even know what is crypto? Or a thing like it exists due to lack of knowledge and awareness, and also some don't like it because they think it is involved in dark activities.
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The blockchain has improved our economy so well by making it to be more transparent and has added value. Now people can make transactions with a clear mind of not being robbed.
With the blockchain revolution, it is hard for fraudulent activity to take place where we get to see systems hacking, and embezzling of funds. The blockchain provides adequate security and that is indeed a great contribution of the blockchain to our economy today.
You have done well sir, wish you goodluck.
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The invention of cryptocurrency is too old but still, it is struggling In some nations because of its digital nation. You said it right, the immutable nature of blockchains makes them stand out. But still, a lot of challenges are yet to be faced by this technology to fully widespread in the world.
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Sí amigo, estoy muy de acuerdo contigo en que esta tecnología y su revolución, apenas comienza, pienso que poco a pocos irán superando las limitantes y se irá arraigando con más fuerza. Ahora mismo la adopción es baja, en relación a todo el potencial que tiene, pero creo como tú, que allí está el futuro.
Saludos.
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@simonnwigwe
You have cost truly is really expensive as you rightly said. It makes the adoption of the technology difficult too. Thanks for such engagement and expert analysis on the topic of discuss. Keep up with the good work. #steem-on
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