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Hello guys! @aehiguese here with the second class and a continuation of the "It's all about crypto" series. Our last lesson was on:
- Cryptocurrency
- Cryptography
- Money and types of money
Today's lesson will be more in depth. If you are just joining in, you can access my first lesson by clicking here. Remember, the purpose for this lesson is enlighten those steemians who are interested in getting into the crypto world. This series will cover all the basics. I have done my research so as to simplify it for easy comprehension. All questions relating to this lesson should be left in my comment box below. With that being said, let's jump right into the class.
What Is Bitcoin?
Bitcoin is a digital currency, which can not be seen, felt or touched. It only has value as long a group of people are agreeing with the way it's working.
Get On A Platform - Get A Wallet.
Definition of a Wallet: A cryptocurrency wallet is a software program that stores private and public keys and interacts with various blockchain (I am going to talk more about the blockchain in the next class) to enable users to send and receive digital currency and monitor balances.
Why do I need a wallet?
Answer: This is because just like your physical, fiat currency, which can be seen, touched and felt, is stored in a physical wallet, a digital currency is not anyway different. A digital currency requires a digital wallet.
A digital wallet is an elctronic device(software) that allows an individual to make electronic transactions. This can include purchasing items online with a computer or using a smart phone to purchase something at a store.
To view all wallets, click here
Tips About The Digital Wallet
Some wallet provides their users with what is called, a high or a low anonymity. What this means is simply how much personal information is required of you to give before you can start using a wallet.
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Now, if anonymity is high, then the less personal information is required and if anonymity is low, the more personal information is required of you.
Important Aspects Of A Digital Wallet
Digital wallets may be online of offline. Offline wallets are also called "hard wallets" because it can store cryptocurrencies offline and by that, it provides more security for your cryptocurrency.
A wallet need to provide you with a wallet address and a private key.
What Is A Wallet Address?
This can be liken to you account number i.e the place people can send money to you.
A private key is an encrypted key that allows you cryptocurrency to be authenticated in the blockchain.
Note: A digital wallet should not be thought of as being similar to a pocket wallet. The reason is because, a pocket wallet holds the currency when handed out to people as you pay but a digital wallet doesn't actually store currency
Cryptocurrencies don't get stored in any single location. That is why it is called "decentralize..." You need to understand the word "decentralized." It's being used by many but understood by few. The word "Decentralized" is used, referring to a storage system that is not centered in a particular location. Unlike our fiat currency which is centralized(i.e controlled by and stored in central banks), bitcoin or other cryptocurrencies are not stored in a particular location. As a matter of fact, they don't exist anywhere in a physical form
If you get to understand this decentralized concept, It will change your whole perception of cryptocurrency. You need to understand that cryptocurrencies don't get stored. What actually gets stored are the record of transactions on the blockchain.
Without the blockchain, the cryptocurrency you have will be meaningless.
The blockchain authenticates that there is a value. Cryptocurrencies are authenticated, and not stored. To authenticate means to render as real or true.
There was so much I planned on talking about today, but I am going to stop here... This was not the plan but I want you to understand the importance of the blockchain in the crypto world and why we say it's decentralized. I had to keep it short, because if it is too long, not everybody would read it and I also did not want to take much of your time.
Please do read it, there are some vital information in there.
Thank you for stopping by...
A special thanks to all my followers...