A Cryptocurrency, as defined by Wikipedia, is “a financial system that enlists the use of digital currency that exists outside of formal government control.” A number of cryptosystems have been developed since its conception. The main characteristics of a Cryptocurrency include a peer-to-peer (P2P) system that allows instant transfer of information between entities. In most cases, this technology is used in place of traditional money to facilitate trade within a network of individuals or between groups of people that have established trust.
A cryptocoin is not necessarily a traditional currency. A decentralized ledger that tracks the ownership and transfer of cryptosystems, usually on a P2P foundation, provides a more secure and stable storage system for monetary assets than traditional money-based ledgers. However, no system is completely immune from abuse. An unscrupulous party can infiltrate an otherwise trustworthy system, using an internet connection or other form of communication to hack into and sabotage the ledger. When this happens, the value of all affected currencies drop to zero and is generally not recovered until a specific event triggers a recovery process, such as the declaration of a special auction or distribution of newly minted coins.
One way that anICO Benchmark intends to prevent the abuse of cryptosystems is to make changes to its own ledger that make it more difficult for an entity or actor to attack the ledger itself. For example, theICO Benchmark will be introducing a new feature called “Proof of Importance” that will require an entity wishing to send real world asset data to prove that the transaction is indeed important and beneficial to another user. If the data proves that the transfer is indeed vital, then the currency belonging to the attacker will be banned. Other types of proof of importance include “Proof of Existence” and “Proof of Validity,” which are similar to the proofs of ownership used in certain traditional asset transfer systems.
One concern that some people have about a system like theICO Benchmark is how it could affect traditional or older digital currency networks. Traditional currencies may be more inclined to adopt a more decentralized form of ledger technology due to the lack of compatibility between older systems and the new Cryptocurrency system. However, theICO Benchmark will be taking the opposite approach by encouraging more digital currency participants to use the new distributed ledger as well. The main motivation behind this is the belief that more people can contribute to the global economy without relying on a centralized body to control or redistribute their valuable assets. This is also one of the few ways how theICO Benchmark can benefit a government that wishes to gain control over certain assets, such as the currencies of certain countries or central banks. Through the use of a more technically advanced ledger system, there is the potential to reduce corruption within the existing monetary system while providing a more trustworthy method of storing and transferring information.
However, some worry about the long-term impact of Cryptocurrency on the global economy. Some argue that because of the increased efficiency which accompanies the distributed ledger technology, theICO Benchmark will in fact render the end user of the technology, the individual investor, obsolete. As they state in their white paper, “cryptopreneurs may opt to utilize other technologies that are more efficient and cost-effective when dealing with significant volumes of data.” While this may seem like a concerning aspect of the future of theICO Benchmark, it is one of many that they point out. Others believe that it is important for the future of Cryptocurrency to foster competition among existing ledger technologies, such as the distributed ledger technology of the Counterparty Network.
In the end, the use of Cryptocurrency in the financial world has the ability to change the way that many individuals see their own governments and their own currencies. TheICO Benchmark is just one of the many cryptosystems being used around the world today. There is no doubt that the future of Cryptocurrency may hold even more promise than the future of the Internet. Just make sure to do your due diligence when investing in the currencies that are associated with the cryptosystem you plan to use. That is the only way to be a profitable investor in the future.