There are a lot of great and exciting things happening in the world of Microsoft. I am nearly overwhelmed with the evolution of Data Science technologies, my specialty. And yet I’ve not found an opportunity within my current career to dive in and work on solving interesting problems utilizing these new technologies. Instead I find myself becoming more passionate about the developments in Cryptocurrencies.
There is a lot of introductory information available on this topic. I will include some links at the end for further reading. But to summarize and explain it in my characteristic easy straightforward manner: A Cryptocurrency is a digital asset. That is: A Cryptocurrency is something of value that exists as 1s and 0s. Simple, right? Let’s try an analogy, most of you have played some kind of mobile or PC game that involved earning money or points that can be traded in for improvements to your ability to play. In a lot of cases there are means to spend USD, GBP, or Euros to purchase in game Cryptocurrencies. From here on out I will refer to USD, GBP, Euros, other government managed currencies as fiat.
These concepts are directly transferable to Cryptocurrencies like Bitcoin, LiteCoin, Dash, Ethereum, Stratis, ZCash, so many more. They exist within digital systems (computers). They can be traded between fiat currencies. They are not carried around as physical paper or metal. In most cases, they can be acquired through a repetitive process.
Enough about game money, let’s focus on Cryptocurrencies that actually have some financial ramifications. Bitcoin was the first. The brain child of a mysterious personality, Satoshi Nakamoto, took form first as a white paper (technical article). A short time later the concepts in the article were built as software and the first chuck of Bitcoin was created, some of it going to early supporters of the project.
Since that time several imitators have been created. Currently, any Cryptocurrency that is not Bitcoin is called an Altcoin (Alternative Coin). Nearly all of them have some value people are willing to trade fiat to acquire, anywhere from fractions of $0.01 to Bitcoin itself which is hovering over $1100 at the time of writing this blog. The reasons for development of these other coins vary as much as their value. In some cases, there are central challenges with the Bitcoin infrastructure they claim to solve. In other cases, the Altcoin is trying to stabilize the fiat trade value by limiting the supply. And there are those currencies created specifically for the creators to gin up hype, trade a lot of the initial supply for fiat, and then disappear.
Upcoming posts will break out some topics introduced in this blog and cover other concepts in detail.
Wikipedia – Bitcoin
Bitcoin Forum – The most popular place to discuss all Cryptocurrencies
Cryptocurrency Trading Charts