Cryptography is used to ensure the security and privacy of transactions and exchanges, and to regulate the creation of new coins. Cryptography was developed during the Second World War, after the need for secure communication arose. It has undergone many development with elements of computer science and mathematical theory, and now it is used in financial system for decentralized currency.
There are actually people all over the world running this software, and we call them Bitcoin miners.Anyone can become a Bitcoin miner. You can go download the software right now and run it in your computer and try to collect some bitcoins. I can’t say that I would recommend it, because right now, the puzzle is so hard and the network is so powerful, that if I tried to mine Bitcoin on my laptop, I probably wouldn’t see any for about two million years. The miners, professional miners, use this special hardware that’s designed to solve the puzzle really fast. Now, the Bitcoin network and all of this special hardware, there are estimates that the amount of energy it uses is equivalent to that of a small country. So, the first set of cryptocurrencies are a little bit slow and a little bit cumbersome. But the next generation is going to be so much better and so much faster.
Cryptocurrencies are the first step to a world with a global programmable money. And in a world with programmable money, I can pay anyone else securely without having to sign up or ask permission, or do a conversion or worry about my money getting stuck. And I can send money around the world.This is a really amazing thing. It’s the idea of permission-less innovation. The Internet caused an explosion of innovation, because it was built upon an open architecture. And just like the Internet changed the way we communicate, programmable money is going to change the way we pay,allocate and decide on value.