Discover the Fundamentals of Blockchain, Bitcoin, and the Crypto World—Simplified for Everyone
Introduction
Hello, dear readers!
From now on, Tuesdays will be dedicated to cryptocurrencies and blockchain technology. Each article I write will focus on one term commonly used in the crypto community. If you have any ideas or suggestions for a topic, feel free to share them in the comments, and I’ll do my best to cover them.
We’ll start with the basics and gradually progress step by step through short articles, building knowledge about the world of digital cryptocurrencies. I hope to make this journey through the crypto world engaging and educational for you.
The History and Origins of Blockchain
The history of blockchain technology dates back to the 1980s and 1990s when David Chaum introduced the concept of digital currency called eCash in 1983. However, the blockchain as we know it today was defined and described in 2008 by an unknown person or group using the pseudonym Satoshi Nakamoto, whose identity remains a mystery to this day.
Satoshi Nakamoto is also credited with creating the first functional cryptocurrency, which you’ve likely heard of—Bitcoin. Today, Bitcoin has reached unprecedented value.
Imagine this: when Bitcoin first emerged, it was worth just a few cents. Now, its peak value is unimaginable!
As the author of this article, I must confess I once had the chance to obtain Bitcoin for next to nothing over a decade ago. But, being naive and uninformed, I missed the opportunity. Learn from my mistakes!
What Exactly is Blockchain?
Blockchain is a decentralized, distributed, and secure digital ledger that records all transactions on a network.
Essentially, it is a one-way chain of data blocks, where each new link—or block—depends on the value of the previous link. This connection is based on cryptographic principles.
Without blockchain, no cryptocurrency can exist. Blockchain solves the challenge of creating a distributed database without relying on a central authority to oversee transactions. This means there is no need for a central body like a bank to monitor and approve transactions. Instead, power is transferred into the hands of ordinary people.
What Are Cryptocurrencies?
Cryptocurrencies are digital or virtual assets that operate on blockchain technology. They use cryptography to secure transactions, control new unit creation (mining), and verify fund transfers.
Cryptocurrencies are decentralized, meaning any central authority, such as a bank does not govern them. Instead, the power lies in the hands of the crypto community. Some of the most well-known cryptocurrencies include:
Bitcoin (BTC): The first, most popular, and oldest cryptocurrency.
Ethereum (ETH): Known for enabling smart contracts and decentralized apps (dApps).
Other notable cryptocurrencies: Ripple, Cardano, Litecoin, Shiba Inu, and more.
Crypto Term of the Week: HODL
That’s it for today’s basics! As promised, the articles will be short and to the point. Now, let’s move on to the crypto term of the week!
This week’s term is frequently used, fundamental to the crypto community, and highly popular: HODL.
HODL stands for “Hold On for Dear Life” and refers to the practice of holding onto a cryptocurrency for the long term, regardless of market volatility, with the belief that its value will increase over time.
The term originated on December 18, 2013, when a user named "GameKyuubi" posted a thread titled “I AM HODLING” on the BitcoinTalk forum. Frustrated by the constant fluctuations in the crypto market, the user expressed their intention to hold onto their Bitcoin instead of selling it. However, due to a typo, he wrote "HODLING" instead of "HOLDING." The rest is history.
What started as a simple typo has since evolved into a philosophy embraced by the crypto community, becoming an integral part of crypto terminology today.
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