How Bitcoin Users Should Differentiate Cryptocurrency And Blockchain
Due to the continuous growth of popularity regarding cryptocurrencies and blockchain technology, new investors are constantly entering these industries. However, as the new technology is still relatively complicated, a lot of newcomers struggle to understand numerous concepts.
Some of the most common questions touch upon what many consider to be the most basic concepts regarding cryptos and blockchain. One such question is whether they are the same thing, or are there differences? This is what we will be explaining today, hoping to clear out some of the misunderstandings.
Blockchain Vs Crypto
Let's start off by saying that these two concepts ARE different things. Cryptocurrencies are a form of digital money, designed for the purpose of making payments via the internet, but with no connection to traditional money, owned and controlled by banks or governments. Bitcoin (BTC) is the first cryptocurrency to ever be created, and it came to be a decade ago, in 2008.
It was created by Satoshi Nakamoto, a mysterious figure or group that has kept its real identity secret to this very day. Soon after launching Bitcoin, Nakamoto distanced himself from the project, allowing it to follow its own path, and see where it will take it.
On the other hand, there is blockchain technology. This is technology that was designed to underpin Bitcoin and other cryptocurrencies. In a way, Bitcoin is only one of the blockchain's products. While blockchain was originally created to support BTC and allow it to operate, it was not long before it was discovered that blockchain technology has a nearly infinite amount of additional use cases.
Over the years, it grew to become much more than just a supporting aspect of cryptocurrencies. However, as Bitcoin continued to grow and evolve, it started attracting attention. Soon enough, both Bitcoin and blockchain became known concepts that were often used to address one another, hence the confusion that lasts to this day.
Cryptocurrencies came to be as a method of making payments and other types of transactions without the necessity for third parties like banks and other financial institutions. However, they still needed a technology that will distribute them and record these payments. This is the original use case for blockchain. Information stored on blockchain cannot be tampered with, changed, manipulated, or even erased.
Because of this, additional use cases were discovered, and blockchain is currently the most promising new technology that has the potential to change numerous industries. Apart from its applications in the digital asset industry, blockchain also affects real estate, car making, logistics, food products, shipments, and much more.
It also turned out to be a great method of creating decentralized applications, which can eliminate the danger of large companies cording users' private data and selling it to marketing companies. Smart contracts are also one aspect of blockchain technology that shows great promise due to transparency, decentralization, and the fact that information cannot be manipulated.
While a lot of altcoins came to be as a method of making payments within their native blockchains, many others were designed to serve as true digital cash. So far, cryptocurrencies managed to make quite an impression, especially in the last 12 months. However, a lot of institutional investors, banks, and large companies are still against them, believing that they might be scams or projects with no future.
When it comes to blockchain, however, this is actual new technology, and not just a trend. Because of this, no matter what happens to cryptocurrencies in the future, the blockchain technology will remain, as the new emerging tech.