Steemit Crypto Academy | Learn About Cryptocurrency | Homework by @janemorane

Hello Everyone!

Today I am here to do my homework task for professor @levycore which is all about crypto currency and decentralized system, So let's get into it.

1. What is the fundamental difference between Cryptocurrency and the conventional financial system?

If you talk about how cryptocurrency and conventional financial system are created so cryptocurrency is basically form by mining and in mining there is a group of people setting up a huge system for mining and they all solved some really difficult mathematical equations and after lots of effort that get cryptocurrency as a reward. If we talk about conventional financial systems in this system the currency is basically Published by a central authority and they decide what will be the amount of the currency to be published and where to use it but this Is not the case in cryptocurrency.Because in cryptocurrency the currency is not physically published but is mind through mining by different people around the world.  one another advantage of cryptocurrency is that you can use cryptocurrency anywhere around the world in any country without any restrictions and you can do trading, buy and sell with the help of cryptocurrency anywhere.

On the other hand you cannot use your own local currency in other countries except your own country and the same is the case with other countries every country has a specific currency and you will have to use that currency for or buying and for other purposes. 

For example I live in Pakistan and if I have some euro or US dollars I cannot use them in my country as in my country I can only deal in in Pakistani rupees and same is the case with other countries if I go to some other countries I can not use Pakistani rupees over there and cannot buy anything with Pakistani currency.

2. Why is a decentralized system needed?

A decentralized system is a system in which everyone has freedom of speech and everyone is the owner of it's work. control their own activities and make their own rules for their system. On the other hand in centralized system there is a Center that controls all the activities of everyone and you are not supposed to make any decision without the permission of the central authority. a decentralized system provides you the authority of your own work.Decentralized system is needed because there you will not have to follow any rules of anyone and there is no centre. Basically you are your own boss in a decentralized system and you make decisions and you have the authority of all the work you are doing and you can control all the activities by yourself. centralized system is based on P2p which is basically person-to-person. in p2p there is no involvement of a third party and you are concerned with your work by yourself and you do not need any permissions and any requirement from a third party which is usually a centre in centralized systems

3. What affects the value of cryptocurrencies?

Well the value of cryptocurrency is drive by its user itself because whenever there is a huge demand for cryptocurrency its price goes up very rapidly and many of the traders buy cryptocurrency and in that case its value got high and its price increases accordingly. and same is the case win the demand of cryptocurrency got down and no one is investing in cryptocurrency and everyone are quitting their trade from cryptocurrency the value of cryptocurrency Get low and its price affected accordingly.Market capitalization is another big reason that affect the value of cryptocurrency, which is very important. One other important reason that makes the value of cryptocurrency high is scarcity of cryptocurrency .When there are are more demand for cryptocurrency then the total number of the cryptocurrency at that time the production is less and demand is more and the valuable coins get high in price because everyone wants it and due to its scarcity its demand and its prices increases.

4. Why can't everyone be a miner?

When mining is not as easy as it looks. Mining is something that needs effort, attention and lots of experience. To become a minor you will need to set up your own mining setup which is not easy to understand and not everyone can buy such expensive machinery and tools for mining. Mining requires a large workspace area in which you will have to set up all your machines and computers based on mining. Apart from a large area mining machines required you will also need to have a 24 hour internet connection and your availability and experience in the mining is important.

Mining needs patience and experience because it takes too long to build a block in mining and not everyone has that much patience to wait for 2-3 years. Are you on for long and forget this heart and be disappointed and stop mining at that time. Real miners always stay patient and  they know the situation and everything according to which they have to mine their blocks.

5. Why can cryptocurrency transactions be called more transparent?

Cryptocurrency transactions can be called more transparent because in cryptocurrency blockchain provides every user specific address or Code through which they made their transactions which are different and no one knows about it but everyone can see the transactions you are doing in cryptocurrency. all your transactions and your Holdings in your account are all transparent and anyone can see them. This is a very amazing thing to encrypt the world that nothing is hidden and everything is transparent.No one can made all transactions and if your account got hacked or anything else happen to your account everyone will be able to see your transactions and that is the prove of the transparency of cryptocurrency. 

6. Explain how the development of cryptocurrency in your country?

When I am from Pakistan and in my country there is no development going on about cryptocurrency. About 80% of the total population of my country did not know about cryptocurrency because many people really did not believe in the digital currencies until they had got some liquid in their hands. The rest of the 20% of people in  my country know about cryptocurrency but they do not have any idea about how it works and what is the purpose of cryptocurrency and how to use it and get profit from it. because if you don't know how to use something or did not understand it, how will you get into it and get profit. Many of the people are afraid of investing in cryptocurrency because they think they will face loss and they would not be able to ask anyone about their money and their investment so they simply ignore cryptocurrency. The reason for less awareness about cryptocurrency in my country is that there are no developmental lessons for seminars about cryptocurrency. All we need is to spread the people 's awareness about cryptocurrency because until they do not really know about the behavior and the concept of cryptocurrency they would not be able to use it and invest in cryptocurrency.

7. Conclusion

A decentralized system is the future and due to its popularity in the world many of the people around the world are moving towards a decentralized system from centralized system. Everyone is his own boss in decentralized system and that's why many people are moving towards it to get their self free from the central authority.

Thank you for Reading!

With Love

Comments 1

Hi @janemorane , Thanks for submitting your homework

Feedback: You have completed every point and you have understood the basics of cryptocurrency
Rating: 6

22.05.2021 14:17