The first and best known of all of them is Bitcoin. The main objective of cryptocurrencies, in its original conception, was to function as a decentralized payment system, outside the control of banks and governments.
Cryptocurrencies have aroused both enthusiasm and skepticism in recent years. However, understanding their nature does not imply classifying them as good or bad, but rather recognize their complexity and the dynamics that surround them.
Cryptocurrencies are digital currencies that use cryptography technology to ensure transactions. They are a mathematical sequence of 32 letters and upper and lower case numbers, and undermine computers to decipher and control the creation of new logical units and verify the transfer of assets. The first and best known of all of them is Bitcoin, created in 2009 by an entity known as Satoshi Nakamoto. The main objective of cryptocurrencies, in its original conception, was to function as a decentralized payment system, outside the control of banks and governments.
But cryptocurrencies are not infinite because they obey a logical mathematical scheme that has beginning and end. Let’s look at the Bitcoin case. In total, there are 21 million bitcoins, but not everyone has been undermined. In other words, the possible 21 million possible bitcoins have not yet been created (also known as total offer). At the time of writing this article, there are about 19.5 million bitcoins in circulation, which is called circulating offer.
The volatile nature of cryptocurrencies is one of its most important features. To illustrate this, Bitcoin, for example, reached a historical peak of approximately $ 22,000 in December 2022, only to collapse to less than $ 4,000 in a brief period. Then he recovered and today is worth more than $ 100,000. This roller prices mountain has led many to question the stability of these digital currencies, whose assessment is mainly determined by the trend of market consumption. No cryptocurrency has an anchor in a real physical activity of the economy, but its value fluctuates based on the trust and demand of users.
The mining process is essential for the operation of Bitcoin. Miners are participants in the network that use specialized hardware to solve complex mathematical problems in order to determine a new logical block, while in turn they can have the role of validators of the transactions and ensure the reliability of the network. In the crypto world it is charged for creating a new unit of mathematical logical value and is also charged for acting as a validator of purchase and sale through a small commission. As a reward for their efforts, miners receive new Bitcoin units, as well as commissions for the transactions they process. This process not only adds new coins to the circulation, but also plays a crucial role in the maintenance of the safety and integrity of the network.
In the cryptocurrency ecosystem, validates play a fundamental role. They are nodes within the network responsible for ensuring that all transactions are correct and comply with the rules of the protocol. Its function is to verify the authenticity of transfers and ensure that the double expense of the same currency does not occur. This process not only ensures the reliability of transactions, but also preserves decentralization, one of the essential pillars of these novel instruments.
Different types of digital currencies have emerged within the crypto world, and among them are the memecoins. Unlike Bitcoin or Ethereum, memecoins do not usually have solid technological utility or a purpose beyond financial speculation and the community that supports them. They are tokens that, in many cases, are born from jokes or viral tendencies on the Internet and that manage to capture the interest of speculative investors. The best known is Dogecoin, inspired by the meme of the dog Shiba Inu, but in recent years thousands of coins with similar characteristics have emerged, some of which have reached surprising values in the crypto market before falling into oblivion.
Cryptocurrencies, with their fascinating creation and volatile evolution, require a mixture of curiosity and caution. They cannot be labeled in a simple way as something positive or negative; Its value and operation depend on various factors, from its market acceptance to the strength of its own technology. As in any financial system, it is essential to inform and understand the context before getting involved in this exciting, although risky, new world of digital money.
He was a deputy in the Legislature of the City of Buenos Aires twice performing as president of the Budget Commission, he is a public accountant specialist in public finances and presides over the party of the cities in action.
Source: Ambito
