I kept saying for a long time that I would write on this topic, and it kept not happening. At last I have written it 😀

Well, you have surely heard the name Bitcoin? Even if you had not before, you heard it at least in the dark web article. This Bitcoin is a kind of cryptocurrency. But before understanding cryptocurrency, let's learn a little about cryptography. Otherwise the main subject will be somewhat hard to grasp.

Cryptography

“Tfou 3 njmmjpo svcmf.”

Can you understand the sentence above? Many of you may think I have gone mad — what am I writing? Nothing to worry about. The knot of the mystery will come undone in a moment 😉 So let's get into the main text.

Cryptography is a remarkable branch of information science, or data science. Why do I call it remarkable? Because the name of cryptography itself tells you. Cryptography is the science of hiding information. From the name we can see that the art of hiding information or data is what is called cryptography. By now you have surely got a sense of why it is remarkable.

Hiding information really is an important matter. Let me tell you a story. Mr Rafiq is going to build a website where all the officers of his office will log in and do all their work. For that he created a database, in which usernames and passwords would be kept. The problem is that anyone who can get into the database will get the passwords. So he did one thing: he hid the passwords using an md5 hash. As a result the passwords became unintelligible, and security was preserved.

That is a small job. When you undertake a huge project, security has to be thought about before anything else. Otherwise your database can easily be hacked, and then there is nothing to do but hold your head in your hands.

[Note: because md5 has certain flaws it is currently used for non-cryptographic purposes. There are many hashing systems besides md5.]

How cryptography works

The question naturally arises of how cryptography works. I only said that Mr Rafiq hid his information — but will that do? All right, let's take a small illustration. Suppose the Americans and the Russians are at war. Now the Russians are going to send some secret information from headquarters to their soldier. At any moment an attack could happen and the Russians could be caught by the Americans. So the Russian commander received a message:

“Tfou 3 njmmjpo svcmf.”

This sentence surely looks familiar? I gave it at the very start. Its original message is:

“Sent 2 million ruble.”

But how? Now look closely at the cryptography. Here each letter has been replaced by the letter after it. In the original message S has been made T, e made f, n made o, and so on for the rest. Now someone who does not know the trick cannot work it out. So the information can be kept hidden very easily. A method like this was used in Mr Rafiq's case. Hashing is a somewhat different matter, but through this you will grasp the main idea.

This example is a very simple one, of course. Anyone could crack it. It is given here only so that you understand the idea easily. Since today's main topic is cryptocurrency, there is no scope to talk about cryptography in detail. You will get a long article on cryptography and encryption soon (insha'Allah)

Cryptocurrency

By now I hope you have understood that cryptocurrency is hidden, just as cryptography is. Since the word currency is in it, it is related to money. You have guessed right: cryptocurrency is hidden money. This kind of money essentially has no physical form. It is entirely controlled by machines, so its security is extremely high. Even a government cannot keep control over it — which is why cryptocurrency is banned in various countries of the world.

Its greatest advantage is that it is safe and secret. So nobody can find out who is transacting with whom, which is not possible with a bank. But nothing in the world is safe. Cryptocurrency hacks have happened too, and the dark web has been the victim of hacking many times. So it is foolish to think anything is 100% safe.

A currently popular cryptocurrency is Bitcoin. A few more cryptocurrencies are:

1. Ethereum 2. Litecoin 3. Ripple 4. Monero 5. Dash 6. Bytecoin 7. Dogecoin

How cryptocurrency works

Cryptocurrency is a kind of hidden money that goes directly from sender to receiver through a peer-to-peer (P2P) arrangement. So naturally its method of exchange is different too. Now let's discuss how it works in detail. A few of its important parts are:

1. The wallet:

It is just like a wallet in real life. The difference is that this is a wallet with strict security. It can be either online or offline. This is where you keep your money and spend from as needed. And when someone sends you money it is deposited in this wallet. Every wallet has its own particular encrypted address, rather like an IP address — except that this one is encrypted and unique.

2. The blockchain:

The blockchain is a process in which sending money from one address to another is recorded in an encrypted ledger. Note that the information stored here can be viewed from anywhere in the world.

3. Mining:

So the system has been built. Now its security arrangements need to be strengthened further, and that is where mining comes in. Checking the validity of all transactions on the blockchain is called mining, and those who do this work are called miners. As a result transactions become risk-free.

Bitcoin

The most popular name in the world of cryptocurrency is Bitcoin. Bitcoin (₿) is the world's first and most popular open-source cryptocurrency and digital currency. It was launched on 18 August 2008, beginning its journey through the domain name bitcoin.org. In November 2008 Satoshi Nakamoto published a paper on what Bitcoin is and how it works, on the mailing list of the metzdowd.com website.

In 2009 Nakamoto released Bitcoin's source code on a website called Sourceforge. In the same month the Bitcoin network was broadcast and Satoshi mined the very first block of the blockchain, which is called the ‘genesis block'. Bitcoin has been running from then until today. Bitcoin is essentially very popular for illegal transactions, and there is a good opportunity for transacting with Bitcoin on the dark web.

That is all for today. Thank you for reading.