LinkedIn Learning: Cryptocurrency Foundations: Module 1 - What is Cryptocurrency?

Double-spend

- Scenario, in the Bitcoin network, where someone tries to send a bitcoin transaction to two different recipients at the same time. - However, once a bitcoin transaction is confirmed, it makes it nearly impossible to double spend it. - The more confirmations that a particular transaction has, the harder it becomes to double spend the bitcoins.

Distributed ledger is popularly know as?

A: Blockchain!

Crypto tokens

AKA: tokens another blockchain-based crypto asset. Run on top of existing blockchains rather than having their own blockchain like Bitcoin. Tokens generally represent physical and digital assets, utilities and services Example: fractional ownership of a car, stock, or estate

Cybercriminal

An individual who uses computers, networks, and the Internet to perpetrate crime.

What makes cryptocurrency appealing?

Anonymity and absence of oversight conducive for cybercriminals

ICO

Initial Coin Offering, somewhat similar to an IPO in the non-crypto world. Startups issue their own token in exchange for ether. This is essentially crowdfunding on the ethereum platform. Used to raise capital

How does the Blockchain verify the buyer?

Through the use of public and private keys

Distributed Apps (dapps)

[(applications or software) that run on multiple computers within a network simultaneously] and [can be stored on (servers or cloud computing platforms).]

The Cardano crypto, for example, is an application running on Blockchain technology in a similar way to

a spreadsheet application running on Microsoft Windows or the Apple macOS

Exchange in the crypto sense

a third-party service used to conduct transactions on a person's behalf relating to cryptocurrency.

Blockchain: private key

a way to unlock the mailbox

market cap

an estimation of the value of a business that is obtained by multiplying the number of shares outstanding by the current price of a share

Web3

an idea for a new iteration of the World Wide Web which incorporates concepts such as decentralization, blockchain technologies, and token-based economics.

Distributed ledger

consensus of replicated, shared, and synchronized digital data geographically spread across multiple sites, countries, or institutions

How are NFT's recognized?

denoted by an entry in a blockchain, such as Ethereum, that proves ownership of an asset.

What does an NFT store in a blockchain?

details of a transaction

Cross-border payments

financial transactions where the payer and the recipient are based in separate countries.

Security tokens or STOs

issue tokens for an investment contract in an underlying investment asset, such as a stock or bond. The security token captures all ownership information in a blockchain record.

Governance tokens

issued to users to represent voting rights that can be exercised to influence the operations and future development of DeFi solution

Solving the double spend problem requires _____.

keeping track of all transactions

The magic of a Blockchain network ___________

queues up all transactions, validates them as being legitimate, and then adds them to distributed copies of the ledger without the need to trust participants

Blockchain: public key

similar to a mailbox, where people know where to send something. The public address

In a blockchain network, trust is enabled through _____.

software code

Collateral tokens

supply and support loan liquidity

Market Capitalization

total value of a publicly traded company's outstanding common shares owned by stockholders

Fee Tokens

used to facilitate banking fees

What's a new popular type of token?

NFT's - non-fungible tokens

How are cryptocurrencies used as investments assets?

People try to buy low, hold, and then sell high

STOs legalities

STOs have a much higher degree of oversight. For example, they must conform with financial regulations, such as KYC (Know Your Customer) or know your customer and AML or anti-money laundering laws

Who came up with the idea of Bitcoin?

Satoshi Nakamoto Note: Probably not the real person's name but perhaps their pseudonym or possibly a group

How does Blockchain help the prevent the double-spend problem?

The Blockchain keeps track on what is spent

How does cryptocurrency enable trust from participants?

The Blockchain's source code

Tokenomics

The characteristics of how supply and demand of cryptocurrencies and tokens function is known as

Blockchain

A digital ledger that contains time-stamped transactions made in bitcoin or another cryptocurrency are recorded chronologically and publicly.

Ledger

A group of accounts

What has been the governmental response to crypto

1. Accepting the cryptocurrency, sometimes as legal tender 2. Banning cryptocurrency

Which countries are experimenting with their own cryptocurrencies?

1. China 2. Britain 3. Sweden

Who banned cryptocurrency

1. China 2. Bangladesh 3. Iraq 4. Several others

DeFi important functions

1. Facilitating trading 2. Payments 3. Investments

DeFi tokens

1. Governance 2. Fee 3. Collateral Good Free Cars

Things to consider if a cryptocurrency is good or not

1. If there are a finite or infinite amount number of cryptos being issued 2. Track market capitalization, trading volume, price stability, and number of participants

What banking institutions support cryptocurrency

1. JP Morgan Chase 2. PayPal 3. Wells Fargo 4. Goldman Sachs

Things to consider to invest in tokens

1. Leadership 2. Talent 3. Technology behind them

DeFi

Decentralized finances, a type of financial service that Ethereum has offered. These innovative solutions provide lower cost, more accessible, more open and higher-speed financial services that range from lending to insurance.

In 2021, which country made Bitcoin legal tender?

El Salvador

Who became the first country to declare Bitcoin as legal tender?

El Salvador

Cryptocurrencies that offer a compelling application platforms

Ethereum, Solano, and Ergo