Is Blockchain Actually Needed for Cryptocurrency Development?
Let’s get to the point straightaway! Everyone is busy talking about Cryptocurrency and Blockchain. They just want to hire a Blockchain software development company to get a Blockchain ready for their business.
It’s just because Cryptocurrency and Blockchain are the hottest 21st Century financial technology trends. Many large-scale businesses like Amazon and Alibaba are embracing both the concepts. That’s the only reason. All in all, they hire Blockchain developers just to end-up pulling their hair in frustration.
It’s mainly because there is a difference between the two concepts. That’s what you don’t know.
How Blockchain and Cryptocurrency are Poles Apart From Each Other?
Don’t think this list of questions is ending soon in this series of articles. You’ll have to answer a plenty of such questions!
Let’s now get the answer!
The Difference Between Blockchain and Cryptocurrency:
1) Blockchain is actually a decentralized or distributed ledger technology. It’s capable of forming a chain of blocks. Remember, every single block in this chain contains information that’s fully verified. All these blocks are then validated and brought onto the chain of transactions as well as the information on previous blocks.
2) A distributed/decentralized ledger is used to record these blocks of transactions permanently. According to the experts associated with the Blockchain software development companies, this distributed/decentralized ledger is called Blockchain.
3) Cryptocurrency is a digital currency based on Blockchain. It’s developed on the basis of Cryptography.
Let’s Help You understand it Easily:
Cryptocurrency and Blockchain go hand in hand. Cryptocurrency is required to carry out transactions on blockading. Blockchain serves as a ledger (decentralized) to help record and transfer Cryptocurrency transactions.
All in all, you can call Blockchain an ecosystem and Cryptocurrency as its part.
Before you hire Blockchain developers, that’s something important you must understand about Blockchain and Cryptocurrency.
Is that what you’re thinking?
Wait a minute then!
There is something more for you to seek an answer to!
- Is Blockchain Required for Cryptocurrency Development?
That’s the first misconception in the mind of everyone talking about Blockchain and Cryptocurrency. Blockchain software development companies use it as a platform that serves as a digital decentralized ledger required to record and transfer transactions.
Therefore, it’s not a programming language required to develop Cryptocurrency. All in all, coding/programming languages are required to develop Cryptocurrency instead of the Blockchain.
- Why is Blockchain Required for Cryptocurrency Transactions?
How is Blockchain technology better than our traditional banking system for financial transactions? That’s what you can say in other words.
Now let’s seek an answer to this question. According to Mr. Shubham Chakraborty, a Cryptocurrency investor, banks invested depositors’ income in schemes that failed and didn’t yield any returns. That massive financial disaster in 2008 jolted investors’ faith in our traditional banking system.
That’s when Satoshi Nakamoto published a paper suggesting the application of Blockchain, a decentralized system for financial transactions.
Coming to the point, Businesses need to hire Blockchain developers for the following reasons:
1) Affordable Cryptocurrency transactions
2) Secure transactions
3) Data Theft/Hacking/Tempering is Almost Impossible
4) Data Redundancy
Now arises another important question.
Is there any alternative to Blockchain Technology for Cryptocurrency Use?
Blockchain technology is in its infancy. But its competitors have already started showing the signs of their existence in the form of IOTA and Nano.
- Do you think IOTA and Nano are soon going to make Blockchain a thing of past?
- Which technology will replace Blockchain? Is it IOTA? Or is it Nano?
Well, it’s too early to say anything in this regard. It’s because Blockchain is in its infancy. Moreover, it’s been accepted on a global scale by the businesses for financial transactions. It’s because it’s a decentralized digital ledger that offers security many more benefits.
Since Blockchain has been accepted globally, it’ll be very difficult for other technologies to replace it. There must be some revolutionary technology to replace Blockchain. It doesn’t seem to be happening anytime soon, says Mr. Shubham Chakraborty.
The Bottom Line:
Blockchain and Cryptocurrency are different from each other. One is the ecosystem and the other one is the part of this ecosystem. Blockchain isn’t required for Cryptocurrency. However, it’s required for Cryptocurrency transactions. But again, it isn’t the only choice you’ve got!
There is some alternative available in the form of IOTA and Nano. We’ll soon guide you about both these technologies thoroughly. Meanwhile, you keep coming back to our site.
Our next post in this series of articles will guide you on the steps to build Cryptocurrency using the types of Blockchains we explained in our previous post.
Do you know this already? Are you looking for Cryptocurrency and Blockchain development services?
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