What is Cryptocurrency? Finding out the Best Crypto Exchange Canada

Cryptocurrencies are just one of many use cases for blockchain, a technology that’s used today in almost any industry you can think of, such as real estate, food supply chains, and retail. But when people talk about the cryptocurrency market, they’re talking about trading cryptocurrencies like Bitcoin, Ethereum, XRP, and thousands of others. And to buy them, there are more methods and places. Let's find out the best crypto exchange Canada for better transactions. 

Bitcoin is a cryptocurrency that, like all cryptocurrencies, runs on a technology called blockchain, a publicly available, decentralized ledger. Basically, this is a big database that records transactions. It’s maintained by everyone who uses the network, can’t be tampered with, and all transactions recorded on it are public, for anyone to see.

The History of Cryptocurrency

The most famous cryptocurrency, Bitcoin, dominates the market, with over 70 percent of the market cap. Its origin story is vague: Its alleged creator is Satoshi Nakamoto, who released an academic paper explaining the purpose of the coin for Bitcoin back in 2008. 

Nakamoto envisioned a system for a virtual peer-to-peer cash system that was completely decentralized and self-sustaining, unable to be legislated upon by central banks. Rather than a company, its ledger is maintained by a network of so-called “miners” other users on the network who use their computers to solve computationally intensive problems that confirm the validity of transactions on the network. 

But following the whitepaper, Nakomoto who still holds hundreds of millions of dollars worth of Bitcoin was nowhere to be found. Plenty have claimed to be him, or know him, but his identity remains a mystery. Despite his anonymity, Nakamoto’s legacy is profound. 

Bitcoins used to go for fractions of pennies, but Bitcoin massively spiked in price towards the end of 2017 to a value of almost $20,000 for a single Bitcoin followed by a quick crash in January 2018. Anyone who bought Bitcoins early on got super rich.

What is Cryptocurrency Mining?

You can’t have been involved with cryptocurrency or with researching it without hearing about mining. But get rid of images of soot-covered men working in the dark with pickaxes and a canary. Cryptocurrency mining is the way blockchain’s ledgers are maintained.

A blockchain consists of, you guessed it, chains of blocks. Billions of dollars’ worth of transactions take place on the Bitcoin, Litecoin, Zcash, and Ethereum networks each day, and every ten minutes or so, these transactions are grouped together and rolled into “blocks,” appended to a “chain” of blocks that go all the way back to the “Genesis Block.”

People running complex software—“miners”—race to validate the transactions in these blocks by completing complex algorithmic puzzles. That keeps the blockchain super secure, because miners have to reach the same conclusion about the transactions on a block for it to be recorded as valid,. olving these puzzles requires extraordinary amounts of computational power and electricity, and any attempts to game the network by running thousands of miners. It would be more costly than beneficial. This is why the Bitcoin mining formula is called “proof of work” the integrity of the miners is established by their willingness to pay in electricity.

Mining is an incredibly energy intensive process. If you want to get into mining, think about investing in purpose-built computers, or buying cloud computing space in dedicated mining pools.

Be it buying or selling Ethereum in Canada, you needs to take into account the detailed research about any kind of particular cryptocurrency. Sign up with Netcoins for a detailed study about different cryptocurrencies and start trading in the crypto world.