CRYPTOCURRENCY | Blockchain Technology | Environmental Issues | Bitcoin vs Etherium vs Dogecoin

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7 min readMay 14, 2021

Elon Musk, generally referred as “ECCENTRIC”

First image that comes to our mind after hearing word “Cryptocurrency” is of none other than billionaire ELON MUSK.

Obviously he is the person who gave Cryptocurrency this much hype, that we are seeing now-a-days.

You must have heard the news that “Tesla won’t accept Bitcoin as payment anymore.”

Screenshot from Twitter (Read the image text)

BUT Why?

Why Elon after promoting Bitcoin, refused to accept Bitcoin?
What is Bitcoin?
What is Cryptocurrency and how does it work?
How Bitcoin affects Environment?
How can we take benefit from cryptocurrencies?

All these questions will be resolved after reading this article, Without further ado — Let’s start reading.

BLOCKCHAIN TECHNOLOGY (Impossible to hack)

Blockchain Technology is technically defined as a decentralized, distributed ledger that records the provenance of a digital asset.

Ledger (noun) : a book or a computer document in which a company’s accounts are recorded, especially the money it has spent and received

Above definition has too much technical words, let’s see a simpler one.

Blockchain Technology is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system.

Now let’s try to understand more.

A blockchain is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain.
Each block in the chain contains a number of transactions, and every time a new transaction occurs on the blockchain, a record of that transaction is added to every participant’s ledger.
The decentralised(distributed) database managed by multiple participants is known as Distributed Ledger Technology (DLT).
Blockchain is a type of DLT in which transactions are recorded with an immutable(irreplaceable) cryptographic signature called a “hash”.

Why it is impossible to hack?

Suppose if one block in one chain was changed, it would be immediately apparent it had been tampered with. If hackers wanted to corrupt a blockchain system, they would have to change every block in the chain, across all of the distributed versions of the chain.
Even a child would guess how much difficult it is to hack across lakhs of computers. Hence Blockchain Technology is known to be “impossible to hack”
Security feature of Blockchain Technology makes it the inevitable need of the future.

Now, Blockchain is a very broad topic. Above information will give you an overview about Blockchain Technology. To know more about Blockchain Technology you can find plethora of articles on the internet but reader must watch the video from ted, below to understand the significance of “DLT” in a good detail.

CRYPTOCURRENCY (Need of the future)

A Cryptocurrency (or “crypto”) is a digital currency that can be used to buy goods and services, but uses an online ledger with strong cryptography to secure online transactions.

Cryptography is associated with the process of converting ordinary plain text into unintelligible text and vice-versa.

It is a form of payment that can be exchanged online for goods and services.
Many companies have issued their own currencies, often called tokens, and these can be traded specifically for the good or service that the company provides.
You’ll need to exchange real currency to access the goods and services that the company provides.
Cryptocurrencies work using a technology that we have studied earlier — Blockchain Technology.

More than 6,700 different cryptocurrencies are traded publicly, according to CoinMarketCap.com, a market research website.

Why do we need Cryptocurrency?

Three main features that Cryptocurrency provides are:

Decentralization: Cryptocurrency removes central banks from managing the money supply, since over time these banks tend to reduce the value of money via inflation. This is basically decentralization of Currency.
Security: More secure than traditional payment systems.
Double Spending Problem: Cryptocurrency solved the double-spending problem for digital currency using a peer-to-peer network.

Currently there are 2 main disadvantages also :

1. Instability of Cryptocurrency

2. Huge Electricity Usage (will be discussed later in this article)

But these can be removed using human intelligence.

There are many cryptocurrencies in the market but here we will compare top trending: Bitcoin, Etherium & Dogecoin

BITCOIN vs ETHERIUM vs DOGECOIN

To understand the difference between these 3 cryptocurrencies look at the table below.

All cryptos have their own history but let’s start with the “funniest one”:-

1. DOGECOIN (Funniest + Environmental friendly)

Dogecoin was created by IBM software engineer Billy Markus and Adobe Software Engineer Jackson Palmer, who decided to create a payment system as a joke, making fun of the wild speculation in cryptocurrencies at the time.
Dogecoin features the face of the “Shiba Inu” dog(hunting dog, breed from JAPAN) from the “Doge” meme as its logo.

It was introduced on December 6, 2013, and quickly developed its own online community, reaching a market capitalization of US$85,314,347,523 on May 5, 2021. (Source: Wikipedia)

Dogecoin promotes the currency as “fun and friendly internet currency”, since it was started as a joke.
If you want to look at more data, see the table above or simply search on internet.

2. BITCOIN (Popular + Rich)

Bitcoin cryptocurrency was invented in 2008 by an unknown person or group of people using the name “Satoshi Nakamoto”.
The currency began its use in 2009.
Bitcoins are created as a reward for a process known as mining.
Mining is a record-keeping service done through the use of computer processing power.
Miners keep the blockchain consistent, complete, and unalterable.

3. ETHERIUM (Developer Friendly)

Ethereum was proposed in 2013 by programmer Vitalik Buterin(Russian).

In 2016, a hacker exploited a flaw in a third-party project called The DAO and stole $50 million of Ether. As a result, the Ethereum community voted to hard fork the blockchain to reverse the theft and Ethereum Classic (ETC) continued as the original chain. (Source: Wikipedia)

Buterin believed that Bitcoin and Blockchain Technology could benefit from other applications besides money and needed a scripting language for application development that could lead to attaching real-world assets, such as stocks and property, to the blockchain.
Hence, he proposed the development of a new platform with a more general scripting language that would eventually become Ethereum.

Now, After learning all about Cryptocurrencies, let’s move ahead look at a significant disadvantage of the Cryptocurrencies.

ENVIRONMENTAL DESTRUCTION

How Cryptocurrencies affect Environment?

Bitcoins are created, or mined, using a concept called proof of work, which involves solving functionally useless and computationally difficult puzzles that consumes huge amount of electricity.

Bitcoin now represents an estimated 0.59 per cent of global electricity production, or enough to power all the kettles in UK to boil water for 33 years. (Source: UK Newspaper)

The majority of Bitcoins are mined in China and is largely fuelled by cheap coal power in the Xinjiang region,
Bitcoin’s currency’s annual electricity consumption is estimated to be 148 terawatt-hours and rising, or around the same amount as Poland’s.
Dogecoin uses less energy per transaction than bitcoin because the calculations used to mine coins are less complex, with bitcoin requiring 707 kilowatt-hours for each payment and Dogecoin requiring just 0.12 kilowatt-hours, so a switch could reduce Tesla’s environmental impact.
Above is the reason why Musk switches to Dogecoin from Bitcoin.
This disadvantage will be resolved over time because many developers are currently working on this.

Let’s end this article with a Conclusion Sub-heading.

CONCLUSION

Obviously because of its price volatility and such high price (except Dogecoin whose price is around 40 Rs), Middle income people will stay away from investing in these Cryptocurrencies at least until this price instability issue isn’t resolved but being informed is the duty of every responsible citizen.

Wherever Musk’s thoughts on cryptocurrencies go next, it is clear that the billionaire’s tweets can have a significant impact on the society. His refusal to accept Bitcoin, caused an sudden 15% drop, but prices are rising again.

Undoubtedly, disadvantages of Cryptocurrencies will be removed or reduced in the near future but currently looking at the data suggests that to invest in Dogecoin instead Bitcoin is good for environment and can reduce our Carbon Footprint.

SOURCE OF DATA: Wikipedia, News Articles, Investopedia, Twitter News & Some YouTube videos.

I hope that this article added value to your knowledge and provide substantial information regarding Cryptocurrency and why it is trending now-a-days. Share this article with others if you want to share knowledge & spread awareness regarding CRYPTOCURRENCY.