Are you also trying to find Is a cryptocurrency a Blockchain? Or do you want to know about Blockchain vs Cryptocurrency? If yes, this blog can help you understand the difference between Blockchain and cryptocurrency.
To have an in-depth understanding, first, need to understand the basics of the concepts. In upcoming sections of this blog, you will go through all relevant information.
Crypto Wallet Development is one of the hot trends along with Blockchain development. The wallet is for storing and transacting cryptocurrency. But the point is the terms Blockchain and Crypto seem similar, but they are not. Blockchain stands for technology and applies not only to cryptocurrency but also to other things or tasks.
On the other side, cryptocurrency is the digital currency you can transact with the help of the Blockchain Network. You can exchange your physical currency by converting it into cryptocurrency.
So, let’s proceed to dig more into how Blockchain and Cryptocurrency are different and how they are connected with each other. First, it would be better to have a look at some key stats about Blockchain and Cryptocurrency.
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Key Stats: Blockchain And Cryptocurrency
The key stats will provide you with a broader insight into the current market stats of Blockchain and Cryptocurrency.
- In 2021, the global blockchain spending was $6.6 billion.
- The highest distribution of Blockchain market value is in the Banking sector.
- The US has the maximum share (51%) of overall Blockchain funding.
- Binance is recognized as one of the leading Cryptocurrency exchanges worldwide.
- By 2027, the global Blockchain market will be $163 billion.
- Worldwide, Coinbase Cryptocurrency users 108 million.
- The USA is at the top of Bitcoin mining
- By 2023, the cryptocurrency segment is expected to reach $42.69 billion.
- With a CAGR (2023-2027) of 14.36%, cryptocurrency revenue is expected to grow by $73.01 billion.
- The number of users is projected to reach 347.73 million by 2027.
These stats indicate ample growth in the crypto and Blockchain market, and the reason is almost all industries are focusing on adopting Blockchain and Cryptocurrency technology.
Now, move forward to read for upcoming sections of this blog. The information you are going to read will help to find out the difference between Blockchain vs Cryptocurrency.
What is Blockchain?
In simpler terms, you can understand Blockchain technology as an advanced database mechanism that facilitates transparent information sharing across the business network. It stores information in the form of blocks where all blocks are linked together in a chain format.
The nature of the Blockchain Network is decentralized, which means data remains on a decentralized network or is distributed across the network of computers called a distributed ledger.
If you want to know more about block connections, then it is like all blocks have different storage capacities. So, whenever they filled and closed then, they linked to the previous block that is already filled. Each block is added to the chain with an exact timestamp.
How Blockchain Works?
Adopting new technology is such a bright idea for the business where you can choose Blockchain development as one of the beneficial technology. But before implementation, it would be better to know about its working.
The concept of Blockchain is introduced to record or store information digitally but not edited. Based on it record can’t be deleted, altered, or destroyed, and it remains available on the decentralized network.
So, blockchain technology works like this:
- New transaction entered
- The new transaction is transmitted to a global decentralized network formed by peer-to-peer computers.
- As a next step, the network solves the equation and confirms the validity of the transaction.
- Confirmed transactions clustered together into blocks.
- All filled blocks are chained together and create a long history of all permanent transactions.
- Transaction complete.
What Are The Advantages of Blockchain Technology?
Due to having a decentralized network ability, there are multiple advantages associated with Blockchain Technology which are:
Data is more important than anything in this digital world, and its safety is more crucial. Blockchain technology facilitates securing it in a better way. It can change the showcasing of crucial information to the world. The data remains end-to-end encrypted, and no one can alter it. It remains distributed and restricts hackers from stealing the information.
Due to the distributed ledger technology, data and transactions are stored at different locations. All participants having permission can view the data simultaneously, but no one can modify it, ensuring high transparency. Additionally, data is stored with timestamps so a permissible person can view history.
There is no bondage of censorship with Blockchain as it does not have control of an individual party or authority. For example, in traditional database systems, a single party controls the database.
Blockchain technology offers high traceability. Actually, it creates an irreversible trail that can be audited anytime quickly. You can observe all changes over the network. To create trust among the customers, an organization can share the data with its customers with ease.
Efficiency & Speed
One of the best parts of Blockchain technology is – it is more efficient and fast compared to traditional info-sharing processes such as paper-heavy processes. It eliminates all types of chances of manual errors and the presence of third parties. Due to the streamlined process, transactions are fast and steady.
A blockchain development company can help you to automate the transactions not only due to their expertise but also due to the nature of Blockchain. It facilitates automating transactions in the finest way.
These are the advantages or benefits of Blockchain. While going through the next sections of this blog, you would love to read about cryptocurrency. Now let’s move to the next section, which holds basic information about Cryptocurrencies.
What is Cryptocurrency?
There will hardly be anyone who does not know Bitcoin. But if not, then it is one of the finest and simplest examples of Cryptocurrency. Historically, it is the first-ever Cryptocurrency launched in the year of 2009.
There is an interesting story behind the launch of Bitcoin- the first-ever Cryptocurrency in this world. It was created by an anonymous group using the pseudo name Satoshi Nakamoto, and this name appeared in a whitepaper published in 2008. Later many people claimed to be the real Satoshi Nakamoto but failed to prove it. Still, Satoshi Nakamoto is a mystery.
The simple definition of Cryptocurrency can be given as it is digital money having a market value similar to the other currencies. These can be stored as the value, for example- storing gold value.
In other words, cryptocurrencies are digital assets that can be used for financial transitions. It uses robust cryptography that makes it completely secure. Another reason that makes Cryptocurrency secure is an exchange in a decentralized network called Blockchain.
Due to its secure nature, businesses are leveraging it with their technical partner, such as – a Cryptocurrency development company.
How Cryptocurrency Works?
The strangest thing about cryptocurrencies is that they do not have any censorship and are centralized in nature. It is implacable to know about the working of Cryptocurrencies, to know about Bitcoin vs Cryptocurrency. It works outside the global banking system, and no one can dominate it. So, let’s break down the working of Cryptocurrencies.
You will be surprised to know that cryptocurrency is generated by the mining process, which is complex in itself. The mining process works like the miners solving a complex mathematical puzzle using specialized computer systems and getting rewarded with bitcoins. The estimated time of the process can be extended up to 30 days. The experts performing mining are called – Crypto Miners.
Buying, Selling, And Storing
Any user can buy cryptocurrency in three ways- they can buy from individual currency owners, brokers, and central exchanges. One of the best examples of Crypto Exchange is – Coinbase.
Once a user buys the currency, they need to store it, and here come Digital wallet development services. Crypto wallets or digital wallets facilitate the users in the best way to store cryptocurrency.
Transaction or Investment
With the help of Crypto Wallet, the transaction is very easy. Using smartphones, users can exchange cryptocurrency with each other. A user can use cryptocurrency for:
- Buy goods or services
- Cash exchange
- Buy digital assets and more
In addition to the working of cryptocurrencies, some types also exist, which are:
- Bitcoin: the first cryptocurrency of the world
- Altcoin: alternative currency to Bitcoin, for example, Ethereum, Lucky block, Terra, Shiba Inu, and more.
- Crypto Tokens: tokens sound similar to the currency but cannot be mined as currency
What Are The Advantages of Cryptocurrency?
There are certain advantages associated with Cryptocurrency and have a direct relationship with Blockchain vs Cryptocurrency. So, here are the benefits of Cryptocurrency.
Traditional transactions can take more time, but not with the cryptocurrency exchange. It is a matter of a few minutes in which a crypto transaction takes place.
Cost Effective Transactions
Charges for traditional international transactions are more compared to Cryptocurrency. You can also understand it as the wire transfer fee is more than the median transaction fee.
With traditional currency, there is always a fluctuation, but there is no fear of inflammation with cryptocurrencies. These are released with fix amount. Still, there are only 21 million Bitcoins released so in the future if there is more demand, then the value will definitely be increased.
For money transactions, security, and privacy is also big concern. Here cryptocurrency mechanism provides complete security and safety. Due to the high level of Cryptography, it is impossible to disturb the transaction process. Additionally, you can also implement more security with the help of Blockchain development services.
Until the section of this blog, you have gone through information like blockchain technology, what Cryptocurrency is, their working, and advantages. Now, it’s time to differentiate between Blockchain and Cryptocurrency.
Blockchain Vs Cryptocurrency
There is a surprising truth that exists, and that is Cryptocurrency is the first-ever application built on the basis of Blockchain technology. Even this single line is enough to differentiate Blockchain vs Cryptocurrency and that Blockchain is a technology whereas Cryptocurrency is a digital currency that leverages Blockchain network and technology. It is a key difference related to Blockchain vs Cryptocurrency.
So, here are the differences between Blockchain and Cryptocurrency.
Blockchain Vs Cryptocurrency
Blockchain is a technology that stores data in a form of blocks and all blocks are linked together in a secure network.
Cryptocurrency is a digital currency that exists in a virtual environment. It is developed on the principles of Blockchain Technology.
Has no monetary value
Cryptocurrency has monetary value and can be used for exchanging real money, trading, and buying goods.
is Applicable to almost all industries such as healthcare, banking, retail & finance, etc.
Trading, purchasing goods, money exchange, digital assets buying, and exchange, or more.
is Highly transparent as all partners located at different locations can view the same piece of information without any alteration.
Can be used anonymously, but the owner can’t be distinguished.
Saving data in a decentralized form.
Medium of money exchange
Decentralized and distributed
Although blockchain empowers cryptocurrencies but can be accessed via digital wallets.
It is all about Blockchain vs Cryptocurrency. The point is clear that Blockchain technology is for implementation that you can implement for the business. The only thing you need to do is hire a Blockchain developer.
They can also help you to develop a digital wallet for cryptocurrency exchange. The cost of hiring a blockchain developer depends on your project requirement.
The Final Thoughts
Most people remain confused about Blockchain vs cryptocurrency. But with this blog, many things have been cleared. Consider cryptocurrency as one of the use cases of Blockchain technology. Suppose, for your business, you want to develop a Blockchain-based wallet; then, it will be a crypto wallet, and here you will leverage mobile app development.
So, next time when you think about Blockchain vs Cryptocurrency, don’t be confused. Still, Do you want to know more about Blockchain vs Cryptocurrency?