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There is a tendency to use the terms cryptocurrency and blockchain interchangeably. Despite being distinctly different technologies, they are also intrinsically interconnected. A blockchain is a digital ledger that is decentralized and public. To simplify it, a blockchain is a large, publicly accessible chain of digital files. Companies like Web Application Development Company use cryptocurrencies and blockchains more.Â
Blocks in a blockchain are used to store the information about transactions, which increases in size as transaction verification takes place. Cryptocurrencies work on digital blockchains instead of traditional currencies, which are owned by centralized authorities. Cryptocurrencies use cryptography for security and are decentralized, making them immune to authority control. To understand this better, let's look deep into what cryptocurrency is and what blockchain is.
What is cryptocurrency?
Bitcoin, or a cryptocurrency, is a payment method available online that can be used to exchange goods and services. Many companies have released their currencies, also called tokens, which are exchangeable for products or services. These coins are just like the ones you would find in an arcade or casino. Think of them as coins. Access to this good or service will require exchanging real money for cryptocurrency. Many web application development services use cryptocurrencies.Â
The technology that powers cryptocurrency is called a blockchain. Many computers are used to manage and record transactions; blockchain technology is a decentralized technology. This technology's security is part of what makes it appealing.
What is blockchain?
The recording of information in cryptocurrency makes it difficult or impossible for it to be modified, hacked, or manipulated. The blockchain network is essentially a distributed ledger of transactions that are duplicated and distributed across thousands of computer systems. Each time a new block in the chain adds up, a new transaction is recorded in the ledger of every participant.Â
There are many transactions in each transaction. Multi-participant distributed ledger technology is known as Distributed Ledger Technology (DLT). Blockchain is a digital ledger that records transactions using a digital signature called a hash.
What is the relation between cryptocurrency and blockchain?
Blockchains are more than a technical component of cryptocurrencies; they are like the driving force behind them. In the end, cryptocurrency and blockchain are linked by their common origins. When comparing blockchain to cryptocurrencies, blockchain transcends them, but they are far from being equal. Several blockchain-based solutions exist and are not limited to the financial sector. They will impact numerous industries.
Blockchain wasn't well known when it was first introduced in the year 2009. Unlike traditional escrow, it doesn't rely on any external entity to keep records of the transactions. Instead, it uses mathematical functions to create a hash code from the data blocks. Bitcoin was not the first cryptocurrency, but it did bring prominence to the design. But nowadays, people are using cryptocurrency just like real money. And blockchain and cryptocurrencies are growing more and more famous day by day.Â
Cryptocurrencies and Blockchains are not strange words for us in this year and time. Everywhere we look, we can see these words. And many companies and businesses use cryptocurrencies and blockchain. Then why are you not? Start using cryptocurrencies and blockchain for your business or company today.
Author Bio
Prashant Pujara is the CEO of MultiQoS Technologies Pvt. Ltd., specializing in Web & Mobile App Development and providing digital solutions to businesses of all sizes.
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Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.