Blockchain and Cryptocurrency have great importance, however; some people don’t know much about them and get confused when they hear about Blockchain and Cryptocurrency. Therefore, through this article, we are going to clarify and tackle the difference between them.
- Is a digital public accounting system in which transactions between users are stored securely, verifiable and permanently. It’s the main technology and protocol that make distributing data and trust in a decentralized fashion possible.
- It is a distributed accounting technology that forms a “chain of blocks”. Each block includes information and data that are grouped and verified. Then, these blocks are validated and linked in the chain of transactions and information of the previous blocks. These transaction blocks are permanently registered in the distributed ledger that is the blockchain.
- It also can be defined as it is the technology that is used as the distributed ledger that forms the network. This network creates the means for transacting and enables transferring of value and information.
- Some people may define it as an actually a logical entity protected by a blockchain node. It is designed to be a mostly read-only database that grows over time as blocks are added. Block payloads are accepted by a node and distributed to its counterparts. There are an acceptance process and verification of digital signatures, but eventually, a block will be validated by enough nodes for the block to be permanently added to the blockchain.
- The term cryptocurrency came from the words cryptography and currency. Cryptography is the art of writing codes, while currency is a monetary system used in a given country. Cryptography is a virtual and digital currency formed through cryptography. Its intangible aspect only avails the currency online. Cryptocurrencies vary from other currencies in that they are not issued by a government but acquired via software and computer programs.
- A cryptocurrency is a digital asset that can be an exchange medium. These days, cryptocurrencies tend to be implemented using a blockchain. This allows transactions using the cryptocurrency to happen in a decentralized, distributed fashion. Cryptocurrencies are relatively new.
- Most cryptocurrency systems use a proof-of-work scheme to create a new block or Bitcoin. Bitcoin uses proof-of-work plans are based on SHA-256. It is used by Lite Coin and possible to use proof-of-stake schemes as well.
The difference between blockchain and cryptocurrency
- A blockchain is a decentralized technology which records cryptocurrency transactions. A cryptocurrency is a virtual tool used in the transactions within a block. Cryptocurrencies can be used to make payments, investments, and storage of wealth. A blockchain is a vehicle that drives the cryptocurrency transactions.
- Cryptocurrencies have monetary value and can be used as a measure of wealth. Blockchains have no monetary value and can’t be used as a measure of wealth.
- Blockchains are used as the basic technology, in which cryptocurrencies are a part of the ecosystem. They go hand in hand, and Crypto is usually essential to transact on a blockchain. But without the blockchain, we would not have a means for these transactions to be recorded and transferred.