Looking back to how and why the system of money came into existence, money didn’t take up the role directly. People in ancient days followed the barter system, which simply means the exchange of goods. Then, people wanted to have value for these exchanges. So, they started to sell goods for gold, silver, or bronze bars. In the same way, these bars were melted and cast into coins. Most kings of those days did trade through coins. As days went by, people found it difficult to carry a large number of coins to places. So, they printed money in form of cash. Paper money came into existence, and each country has a separate value for their own money and they call it differently in different countries. For example, Dollars in the U.S.A, Yen in Japan, Rupee in India, etc. When people started to deposit their money in banks, each one had a bank account. Probably, everyone had credit cards, debit cards, and cheques. Transactions are now being made by just sitting in our houses. Likewise, cryptocurrency or crypto-currency or crypto or Crypto Exchange is now becoming familiar these days.
What Is Cryptocurrency?
A cryptocurrency means invisible money or secret money. The money which can’t be seen. The word ‘crypto’ means ‘invisible’. This system is fully digitalized. This doesn’t have visible paper money. But, it does transactions in a similar way a bank does. This uses technical or mathematical stuff for transactions to be get done. This is a non-governmental means of money exchange, where nobody knows how much money is being transacted by an individual. Nobody updates information about the money being transacted to the server. But the server keeps everything into account and stores the data.
Why Does Cryptocurrency Come Into Existence?
Usually, banks keep track of every account holder’s money. These banks are centralized. It happens for every transaction made; the doer has to pay a certain amount of tax to the bank. This doesn’t happen by our will. The bank does it by them. Some people who don’t want a part of their money to be paid as tax created this technical stuff called cryptocurrency, where they don’t want to pay taxes.
How Does It Work?
Cryptocurrency uses crypto exchange as a platform to buy and sell cryptocurrency. This can be done by exchanging the trade of one crypto for another by converting bitcoin to Litecoin. Firstly, you have to buy these crypto using regular currencies. These exchanges differ from the current market price they offer. Cryptocurrency can also be converted back into regular currency if needed. If you want exchange cryptocurrency, your location may be barrier from buying or selling crypto on certain exchanges due to state or national regulations. It is because some countries like China have banned citizens from accessing Crypto Exchange at all. Some states have instituted their regulations like, they should require a bit license before they can operate within the state or allows only licensed companies to offer certain approved coins.
