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Cryptocurrency is no longer a term that a selected few are aware of. Let’s scratch the surface👇👇
Day 3 of the web3 learning journey. Let’s dive in!
You’ve been hearing crypto all around and your frineds and colleagues have been talking about buying the dip, giving you FOMO for not investing or are equally unaware of crypto as you are.
C: Cryptocurrency/ Coin /Consensus/CEx
Today we are going to discuss things around crypto, what happens in the background when crypto is traded and few details on Centralised Exchanges.
Let’s get started!
Cryptocurrency: a digital asset 💰
or crypto is any form of digital/virtual currency that uses cryptography to secure transactions.
Cryptocurrencies are borderless, decntralized, secure, and maintained by blockchains as opposed to a central issuing or regulating authority. If you want more info on ehat are blockchains, do checkout yesterday’s newsletter, you’d not want to miss it!
Thanks to twitter and memes, I am sure you’ve heard about bitcoin and DOGEcoin, but what excatly are coins in the web3 space?
Coin 🪙 is a cryptocurrency built on its own native blockchain. It can be used as a medium of exchange within that ecosystem or as a store of value.
Example :BTC, ETH, USDT, USDC
It's digital, and there’s no central authority, then who regulates the transactions of these coins?🤔
We have Consensus Mechanism!
It’s a procedure in which the peers of a blockchain network reach agreement.
Reaching consensus is necessary for new transactions to be verified & new blocks to be added to the blockchain
It helps achieve agreement, trust, and security across a decentralized computer network.💯
There are 2 kinds of consensus mechanisms:
📌Proof of Work(PoW)
📌Proof of Stake (PoS)
More on this in the coming days 🚀
I am sure, by no you understand what cryptocurrency is, what a coin is.
The bigger question is how do we buy and sell crypto currency?
The answer is CEx and DEx 💁🏻♀️
CEx- Centralized Exchange
It refers to platforms that facilitate the trading of cryptocurrencies for other assets, including digital and fiat(USD, INR etc) currencies and are managed by a centralized business or entity.
More on decentralised exchanges in tomorrows web3 dispatch💁🏻♀️
Thats a wrap for today!
Stay tuned for more on the new vocabulary of the web for next 30 days.💯
It’s like a free crash course on the jargons and terminologies in Web3.
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