How Cryptocurrency Works: Easy Explanation. (Basics)

This is a video on “how cryptocurrency works & why was there a need for it”.
#Cyrpto #needforcryptocurrency #wallstreetmojo #cryptocurrency #miners

Chapters:
00:00 - Introduction
00:12 - How a Standards Payment transaction takes place?
00:57 - Issues with the standard payment system?
01:20 - Why cryptocurrency is needed?
01:42 - What happens in a Crypto transaction?
02:15 - What is the function of miners in a crypto transaction?
02:30 - How a crypto transaction takes place?
02:50 - What are the benefits or security aspects of crypto transactions?
03:16 - Conclusion

In this video tutorial, we will discuss the standard payment system & its flaws, how cryptocurrency works, why was there a need for it, the steps in a crypto transaction, the work of miners, etc.
Please see the video for complete detail on the topic.

For understanding how cryptocurrency works & why was there a need for it we need to understand the standard payments systems in simple language.

It’s a three-step process.
The shops have payment accepting machines that send data to intermediaries. Intermediary checks with your card bank which verifies your data & deducts money from your account, and the transaction goes ahead. Bank updates your new account records. The data travels the same way back. (Explained in detail in the video)

But there are problems with the bank-controlled payment system:
1. High transaction fee
2. Transaction limits
3. Technical issues etc.

Having a system which has no bank or central authority will resolve these issues.
But, can we cannot trust a single authority or a person to keep records of your transactions and not alter them and cheat you in any way?
However, we can trust the entire network of people.
This is what happens in a CRYPTO transaction.

The whole system is decentralized. This means a copy of a transaction gets distributed as a digital ledger where transactions are recorded to owners of many computers across the world with the same cryptocurrency as you.
The transaction gets verified by “miners” (we will cover this in our coming videos).

So, when you buy something using a cryptocurrency, this is what happens.
1. You give your crypto details to the shopkeeper.
2. The shopkeeper asks every person on the network if you have the money.
3. The network checks all your records.
4. If you have the money, they tell the shopkeeper, update your records, and the transaction is complete.
And if they did, their copy would not match the copies distributed across the entire network, and they would be caught red-handed.
You also get rid of any transaction limit and many more benefits (taken up in the video).

This is broadly how the world of cryptocurrency works. We will cover all the sub-parts of crypto in detail in our coming videos, so stay tuned.

And don’t forget to subscribe and hit that thumbs-up button. And like and share our video, this keeps us motivated to provide better videos to you.

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