The evolution of payments goes back to the days of bartering and trading livestock to gold coins, paper currencies, credit cards, and mobile payments. It dates back thousands of years and will continue for thousands more. Cryptocurrency could be the latest game changer in the industry, but it’s still relatively unknown, with a cloud of mystery surrounding it. According to a Statista report done in 2018, “71 percent of adults had heard of Bitcoin (the most popular form of cryptocurrency), while 21 percent had never heard of any cryptocurrency.”
Over the next three issues of the Reseller Edge newsletter, we will introduce you to the basics of cryptocurrency, the blockchain technology behind it, and how it could potentially disrupt the payment processing industry.
What is cryptocurrency?
Cryptocurrency is a virtual or digital currency, meaning it is created and transferred without the regulation of financial institutions like banks. Its history dates back to 1983 and American cryptographer David Chaum, who developed an electronic money called ecash, which set the tone for modern companies like Bitcoin. The “digital money” uses blockchain technology, which allows the digital information to be transferred but not duplicated in the process. This decentralization means that each individual piece of data has only one owner. Because of this, there is no bank involved approving the transfer or taking a cut of the transaction.