Koda Finance – Can Cryptocurrency Be Forged?
As cryptocurrency experts in the UK, we are often asked if cryptocurrency can be forged. The honest answer is that cryptocurrency is almost impossible to forge.
In this blog post we explain why it is so hard to forge cryptocurrency, making it a good investment opportunity for so many people.
• Cryptocurrency operates on something called a blockchain. Blockchain is known as a distributed ledger, which is like a shared transaction list. By understanding what blockchain technology is, you can understand why it is key to the power of the digital currency.
• The ‘block’ in blockchain technology refers to the chunks of encrypted data that make up a block. The ‘chain’ of the blockchain technology refers to public database. This is where the blocks and stored and sequentially related to each other.
• What’s interesting about a blockchain, and the reason it is so hard to forge, is that each blockchain has a specific code. This is what distinguishes one block from all the other blocks that are in existence. The unique code of the block is known as a hash.
• Blocks of information are then added to the blockchain in a chronological order. A new block is added to the blockchain as soon as the last block is created. With every new block on the blockchain, a new and unique hash is created.
• The ledger, also known as a database of blocks in the chain is simultaneously distributed across the world and spread thousands of computers. In the case of Bitcoin, the first cryptocurrency created, this is distributed among millions of computers.
• If somebody wanted to forge a single block data on the blockchain, they would need to manipulate all the blocks. This includes all the blocks from a point in history and then update all the computers that hold copies of the distributed blockchain ledger.
While in theory this may sound possible, the amount of power and money needed to successfully forge cryptocurrency makes any attempt virtually impossible.
Can cryptocurrency be forged? In theory, yes. However, it will take a LOT of time, effort, power and money!