HOW DO CRYPTOCURRENCIES AND BLOCKCHAIN TECHNOLOGY WORK?

Abstract

Cryptocurrencies are a recent trend when it comes to transactions, though its introduction dates far back to 2009. They are rising to the standards of efficient transaction medium and offer advancements that could potentially revolutionize the whole economic system. While the reason for the sudden hype that emerged for these in the field of marketing, business etc. continues to remain uncertain, Blockchain technology which is the technological algorithm under which these cryptocurrencies function, with its exceptional and unusual approach towards logical structuring of secure layouts contributes in the attempt of finding the answer. It has provided with an algorithm that no present technology can practically hack into! But how far is the scope of the word ‘present’ from the prior sentence? Especially with the galloping advancements in technology, will it still beat the odds and attain what it was able to achieve only to the current extent? The answers to these questions have the potential to determine the scope of cryptocurrencies in future. This paper attempts to find these answers.Objective: This paper intends to help understand the working of blockchain technology in employing cryptocurrencies as a medium of exchange and in turn gaining knowledge on the emerging concept of cryptocurrency itself. It starts with the circumstances which led to the development of cryptocurrencies and the sense of security it attempts to attain. It seeks to do so by taking into account various facts and speculations made by investors in this field.