On-Ledger Currency: Native Crypto Assets

On-Ledger Currency is currency that is both mined on the blockchain and used on the blockchain (e.g. bitcoin).

What is On-Ledger Currency?

On-Ledger Currency is a currency that is located on a blockchain. This is the basis of all cryptocurrencies, all of which must use a distributed ledger (a single copy of the same database) shared by all participants.

Blockchain-based currencies are potentially a better alternative to non-blockchain or fiat currencies. Blockchain-based currencies are held in digital wallets.

Generally, blockchain-based currencies are transparent (displaying transactions and balances for all to see), pseudo-anonymous (without direct user recognition), require constant and incentivised provision of computing power (or other requirements) to maintain operation, cannot be counterfeited and are decentralised.

Bitcoin represents the first example of a distributed ledger-based currency, and there are now many such currencies. These currencies matter because no one single party or group of people with a lot of influence can change its parameters. This means that e-book currencies are devoid of central control.

Currencies are categorised on the basis of the consensus mechanism used, degree of use, liquidity, speed of issue, wallet support and other attributes. On-ledger currency may also be forked (this is due to the open source nature of the blockchain) and used to launch a new on-ledger currency with different parameters.

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