THE BLOCKCHAIN TECHNOLOGY

Image Source

Many of us know a thing or two about cryptocurrency and its market, but many do not actually do not know or understand how this miracle technology called cryptocurrency really work, what underlying technologies lie beneath it, and the fact that pretty much anybody with the right knowledge, resource and team can start their own cryptocurrency, build a market and hence build the value of the currency.

A LITTLE BIT OF HISTORY

Claimed Image of Nakomoto Satoshi

Image Source

We all know the great and invaluable Satoshi Nakomoto, the great mind (or ghost) or appeared out of nowhere started the blockchain technology and with the help of other developers was able to complete and launch out the very first cryptocurrency we know, which is now termed the digital gold called BITCOIN.

(Then he (or they) vanished back into thin air).

Bitcoin began to gain value as more and more people began to buy into the idea of a decentralized market where no single player can influence the market and your identity is protected. Then other developers began to clone the bitcoin code and started other cryptocurrencies and today we have over 2000 cryptocurrencies (and this is just an arbitrary figure as everyday more and more cryptos are still being in developed.

How Does the Blockchain Market Work?

Image Source

Well the truth is that you don not need to understand how the blockchain market work before you can use it, THE FACT THAT YOU ARE USING STEEMIT RIGHT NOW PROVES SO? But for curious minds like me, it is best to use analogy to explain how it works as it is quite technical so refer to the link below to understand how it works

Click Me

Nevertheless, I will still say one or two things about the blockchain market. It is a decentralized market that aids identity privacy, data protection (as the addresses are encrypted), and nodes to "mine" the cryptocurrency. The term mine simply means that the nodes (operating systems most times with GPU) use computational power to compete and solve problems to earn the cryptocurrency (this is the simplest i can explain about it).

How Does a Cryptocurrency builds its market?

Image Source

The first thing any developer of a cryptocurrency wants its visibility, and for that he needs two things.

1) A uniqueness to his currency

2) Free or reduced price of tokens for early birds.

The first thing on the list is self-explanatory, what new thing are you bringing to the table that will make us want to invest in your currency.

The second item on the list is done by most cryptocurrencies, they give out free tokens or cheap tokens at what they call their ICO stage (Initial Coin Offer) or pre-ICO stage to early birds so with the prospect that the currency would rise when launched to the market. For instance, a cryptocurrency still in its ICO stage as of the time of this post that i know legitcoin, is giving out free of its coins for just registering and referring people, and has a special offer of giving a "legitcard" to users who purchase 200 of its token.

There are many more that use similar methods to swerve people to invest into their crypto with prospects that it will rise. Because more people in market means more coin in people hands which equal to increase in value of the coin.

THE FUTURE OF CRYPTOCURRENCY

From the image, we can see where the direction of the blockchain market is going

Image Source

Many people have doubts about the reliability and consistency of cryptocurrencies, but the truth is that if we vividly watch the world direction, with all these hypes of cashless policies and cashless means of payment, and a global means of payment cryptos perfectly solves the equation, what other method do you know solves the equation than cryptos?

THE BEST I CAN SAY REALLY IS THAT CRYPTOS ARE HERE TO STAY, PERIOD. IF YOU DOUBT IT, ITS ON YOUR HEAD.

HOW DOES A CRYPTO GAIN VALUE?

Image Source

Well the major player in a cryptocurrency value like STEEMIT is basically its market. If more people are in the market and are buying the currency and are not withdrawing as soon as they invest (as most people do here) the currency begins to gain value as it is more accepted and there are more buyers in the market than sellers, so sellers force the price of the currency up because of the ancient of life that has always held which is "scarcity always create value". The reason why diamond is so expensive and sand is worthless is that sand is everywhere while diamond is scarce to find, same law applies here, if sellers are scarce in the market and buyers are much, the price of the market shoots up. So the market is the major player in the value of a cryptocurrency.

That's it for now, sorry I have not posted for long, I am away preparing something big, soon I will post about the steemit meetup we organized at Otefe with @destinysaid, @jackdogho, @gbenga, @ehiboss, @illuminatus, @michaelcj and many more of the big bosses on steemit from Nigeria.

NIGERIANS ARE GREAT

STAY TUNED.