Thread by @the_cryptoclass

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If you are #newtocrypto & #web3, this thread🧵 should be just what you need to begin understanding the basics of #crypto, and why you should care:
So...What are #cryptocurrencies, and why should you care?!

At the heart of it, cryptocurrencies are digital currencies or assets that exist independently from governments or central banks. #Bitcoin is the first, and best known cryptocurrency.

Because of the underlying technology that cryptocurrencies are built upon, they give users the ability to transfer value & digital assets to other people without the need for an intermediary such as a bank. This is known as a peer-to-peer transaction.

Most popular cryptocurrencies rely upon 3 key attributes or technologies to be considered a true cryptocurrency:

1. #Blockchain: this is the core technology for peer-to-peer transactions. Blockchain is an open ledger, similar to a database or spreadsheet, that logs every transaction performed on the network.

Transactions are saved to the blockchain in “blocks” of data that are linked….like a chain. Once a transaction is logged, it cannot be changed, making it a permanent record that can be viewed publicly.

2. #Decentralisation: the data on the blockchain is stored across a number of computers across the world meaning no central authority has ownership of the data. This means the data can be verified by many users, and is not owned or controlled by a single entity or corporation.

3. #Encryption: in order to protect data on the blockchain, everything that's recorded is encrypted & cannot be changed. The data is protected thanks to a large number of computers on the network running complex code via mining or staking to validate the data.

Once validated, the data is secured in a block, and the computers that helps to secure it are rewarded with a small amount of crypto as an incentive.

So….why should you care?

Well its clear that there is value in cryptocurrencies, demonstrated by the price of many of them increasing over the years, but it goes a lot deeper than just earning a few bucks…

As these blockchain networks are improved, varying different types of data can be stored on them which allows developers to build real world applications on them. These are called dApps…or “Decentralised Apps”

This means the data associated with these apps is not owned by a central entity & therefore cannot be changed or censored.

Also, because data is secured on the blockchain, this makes data breaches & hacks (something that is unfortunately more and more common) almost impossible.

Lastly, as developers, storing data on a blockchain network means you don’t need to invest huge amounts on cloud storage, servers, or security equipment as it is all stored & secured on a decentralised network.

Finally, and most importantly, when you interact with anything on the blockchain, everything you do is wholly owned by you & in your full control because it is via your cryptocurrency self-custody wallet…but that’s for another thread!

Conclusion:

Certainly there is money to be made in crypto, but beyond that, we can envisage how crypto, or more accurately, blockchain, can be used to drastically shift the way we interact with online applications and digital data.

The future of the internet is about decentralised & secure data, self-custody ie true ownership of digital assets, and mitigation of large scale data breaches that could cost you your personal online data.

Homework:

- Make sure you understand the 3 attributes of cryptocurrency: Blockchain, Decentralisation & Encryption
- Lookup these key words often associated with crypto: #immutable, #selfcustody & #web3
- Like, retweet this thread, and follow @the_cryptoclass if you enjoyed

We will be making new threads throughout 2023 to help educate folks who are #newtocrypto including:

- How to safely buy crypto
- What is a cryptocurrency wallet?
- What are NFTs?
- many more!

Thanks for reading…class dismissed 😉
thecryptoclass.io

Check out our next thread:

https://twitter.com/the_cryptoclass/status/1613724052417544195?s=20&t=Cd8_H2XuS5m-zOGOYZCpNA

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