The Product - Intro

Cryptocurrencies is one of the products that was an innovative trigger regarding Gartner’s 2015 Hype cycle (Gardner, 2015). A crypto currency is a digital or virtual payment method. A currency has a limited amount of ‘coins’. They exist in a huge database which can’t be edited by anyone. The database is protected by a very hard to crack security code which makes sure the coins are verified and safe. Crypto is the first digital coin to succeed (Crypto Insiders, Z.J).

It all started in 2009. A group of anonymous programmers came forward under the name ‘ Satoshi Nakamoto’. They introduced the famous and well-known Bitcoin. It was explained as a ‘peer to peer electronic cash system’. The system would be completely decentralized. This means that there wouldn’t be any servers or authority (like a bank) connected to the currency (Crypto Insiders, Z.J.).

Usually a bank would regulate transactions and keep track of data and other bank related issues. With cryptocurrency, as said before, there is no central authority like a bank. With Bitcoin, the responsibility is with every member of the community. To make sure this works, Blockchain technology was invented. This is a decentralized logbook or register that keeps all data (transactions etc.) secure. This is fully transparent to the community. So, every crypto wallet is open to the users and every transaction is visible at all time (Crypto Insiders, Z.J.).

Every transaction that takes place contains an address and the amount of money (public key) of the receiver and the sender. The transaction only has to be signed by the sender with his private key. Eventually, the transaction will be sent after verification, to the big crypto network. Which is secured with the blockchain technology (Crypto Insiders, Z.J.). The blockchain technology provides some kind of puzzle that verifies the transactions. Miners (users of the coin), pick up the transactions, solve the puzzle, create a verification stamp and spread the transaction throughout their network. Everyone in the network has to verify the transaction. When that’s done, the transaction is final. There is no way back. The miners get the transaction costs from the sender (Crypto Insiders, Z.J.).

There are loads of crypto currencies. The most well-known ones are: the Bitcoin, Ripple, Ethereum, Dash and Litecoin (Crypto Insiders, Z.J.).

Cryptocurrencies is a huge business. For example, one Bitcoin sells for almost $9000,- at the moment of writing. At his peak, the currency hit a record of almost $20.000,- per coin. The Bitcoin has been used as a real-life transaction for the first time in 2009 by an early adaptor of Bitcoin. This person bought two pizza’s at Papa John’s in Florida for 10,000 bitcoins. Just imagine the worth of the coin back then, compared to now. If this particular person saved his bitcoins at the peak point in 2017, he would have $200.000.000,- (Edwards, J. 2019)!

There is a downside to the cryptomarket, because of its decentralisation. The currency is often used for transactions on the black market or the dark web. A lot of criminal goods have been bought with crypto (Edwards, J. 2019).