Categories
Crypto Guides

Exploring The New Suite Features Of ‘CryptoNote’ Technology

Introduction

CryptoNote is an open-source protocol that essentially serves as an underlying technology for some cryptocurrency. Just like Blockchain technology, CryptoNote is also technology that is a backend for cryptocurrencies.

CryptoNote technology was primarily developed to provide extremely private features using advanced cryptography. What makes it unique is the egalitarian approach for making the network decentralized and censorship-resistance.

Origin of CryptoNote

The CryptoNote has had a history similar to that of Bitcoin, in terms of being mysterious. It emerged in 2012 and was published on Tor, and the author of the original whitepaper Nicolas Van Saberhagen is a pseudonym, which means that the identity of the author is still unknown. In fact, the identity of the author of the second edition of the whitepaper is also under the same pseudonym.

The original whitepaper discussed the privacy and flexibility that is deficient in Bitcoin. It also sheds light on the traceability and linking ability of transactions in Bitcoin’s “one-CPU-one-vote,” as explained by the creator of Bitcoin Satoshi Nakamoto. On the whitepaper, they claim to present more advanced features for decentralized cryptocurrency networks that are based on complicated mathematical analysis.

Entering the CryptoNote Technology

The CryptNote technology is similar to the blockchain technology, with few key differences. This technology is built under consideration of two features that make the payment network through this system fully anonymous. They are,

                        Untraceability & Unlinkability

Untraceability – For all the incoming transactions from the network, every sender is equally probable at the origin.

Unlinkability – A property where it is not possible to verify that two outgoing transactions are sent to one particular person.

When the proposal to launch the technology was made, there were many optimizations and improvements made to keep their technology stand apart from the crowd and hold its original principles along the way. The standard features that should be embedded in such technology are implemented as well. The following are the primary features CryptoNote has to offer.

  • Untraceability of payments
  • Unlinkability of Transactions
  • No Double-Spending
  • Blockchain Analysis Resistance
  • Egalitarian PoW

Cryptocurrencies backed by CryptoNote

There are several coins that are implemented using CryptoNote technology. All of the coins have this technology in them in some or the other way. In fact, there are even optimizations made to the current features that are then added to the cryptocurrency.

Bytecoin

Bytecoin is the first cryptocurrency that was created using CryptoNote technology in 2012. Being the first one, it was quite popular back then. This coin includes the exclusive CryptoNight mining algorithm along with the typical features of CryptoNote. Bytecoin was mainly developed to facilitate instant transactions with no fee for businesses, merchants, and customers in the inclusion of security, anonymity, and fast international payments.

Monero

Monero has been one of the most popular cryptocurrency when it comes to privacy. This open-source protocol and decentralized network community are highly dedicated to making Monero a powerful anonymous payment method. And not to mention, this coin is created under the assistance of CryptoNote.

Conclusion

Over the years, people are not completely satisfied with the features provided by the blockchain. Their focus has been on finding inefficiencies in this technology and coming up with other technologies satisfying those inefficiencies. And CryptoNote is one such technology that emphasizes on anonymity in cryptocurrency networks. This is a very broad property and will remain in development for long.

Categories
Crypto Guides

Why Do We Need Cryptocurrencies? What Is Their Purpose?

Introduction

Cryptocurrencies are digital tokens used in the place of conventional fiat currency for the exchange of goods and services. The digital tokens are generated and regulated using encryption techniques called cryptographic hash functions, ensuring security and anonymity.

Why do we need cryptocurrency?

We are living in the digital era, where everything around us is changing swiftly. Not only our phones are smart now, but also our homes. We can speak and see people using video calls at a very cheap rate now. With virtual reality, we can create a different world around us by sitting on a couch. All of these weren’t even possible just a decade ago. But technological innovation has bought us to where we are today. We are amid the fourth industrial revolution today, which fundamentally changes the way we live, work, and relate to each other. Artificial Intelligence, Machine Learning, and Blockchain technologies pave the way for the same. Hence came the age of digital currencies, and they are transforming the way we transact with each other throughout the world.

Let us see in a particular way below on how cryptocurrencies can solve the problems that our traditional fiat currencies cannot solve.

Fraudulent currency

Cryptocurrencies solve the issue of fraudulent currencies. As they are generated and regulated using cryptographic hashing techniques, it is highly impossible to create counterfeit currencies. They are not being minted to create a hard copy of the same type with the same feature. These digital tokens are stored in the blockchain platform, where there is no worry of duplicity.

Double spending

The concept of digital currencies was there even before Bitcoin, but they couldn’t be attained in reality. The obstacle was the double-spending. A digital asset shouldn’t be spent twice to different persons at the same time. Today’s cryptocurrencies operate on blockchain technology. Blockchain technology effectively deals with the double-spending problem as there is a validation procedure involved using a consensus mechanism.

Transferring funds

We can transfer vast amounts of funds to any country around the world in less than 10 minutes. There is no limit to the transaction. The transaction fees are low when we compare with the traditional transaction charges. It takes around 3 to 5 days when we transact using a fiat currency of that size. Taking this much time is not efficient in this age of digital, and cryptocurrencies came to the rescue.

Decentralized network

Cryptocurrencies are generated in a decentralized network without any central bank controlling the system. Since there is no one controlling it, the currency will be stable if the credibility and maintenance of the system are good.

Bottom line

It is time for us to at least try using these cryptocurrencies. Traditional currencies are not going anywhere in the near future, but some credible cryptos are already proving their purpose by solving the problems that fiat currencies couldn’t solve.  Governments have also recognized the huge benefits that these currencies offer and are making or changing laws to favor cryptocurrencies. Not many governments have regulated these digital tokens yet, but the move has started.