In this era, most people rarely have their cash in their possession now. Instead, they have an array of credit cards, debit cards and other payment cards available as their nation’s method of payment. Nothing’s wrong with that, however if the store’s connection to the server is disconnected or their machine is out of service, and you do not possess any cash, you cannot pay.
When using your card, you are giving the end-receiver access to your full-credit line. No matter how small the amount of the transaction is, the fact that you are giving someone your card to gain access to your account is already a form of ‘breach’. Most of this ‘breach’ is considered secure nowadays using differing safety measures like ‘PIN enabled’ or other methods. Then the store initiates payment by ‘pulling’ the designated amount from your account using the information provided within your card.
Cryptocurrency doesn’t work that way. Instead of a ‘pulling’ mechanism, it ‘pushes’ the amount that is needed to be paid or received to other cryptocurrency holders without any further information needed. Payments are possible without your personal information being tied to you or the transaction. Your account can be backed up and encrypted to ensure the safety of your money.
By allowing users to be in control of their transactions helps keep Bitcoin, Ether or other larger cryptocurrencies safe for the network.
Protection from fraud
We often hear of cases where someone’s payment card is being used by other users but not the owner. When contacting his card’s service issuer, it is found that the card has made certain transactions without his consent. This is what we call a fraud case.
Most of the time the perpetrators of these fraud cases get away with the crime because it is not easy to trace the fraud back to the perpetrator. What’s more it is even difficult to get the attention of law enforcers to launch an investigation.
However, cryptocurrency is not viable to be used for fraud. Due to the fact that your personal information is kept hidden from prying eyes, this protects you against identity theft.
Remember, cryptocurrency is a form of digital money, created from code. Individual cryptocurrencies are, as mentioned, digital and cannot be counterfeited by senders.
Because the transactions cannot be reversed, they do not carry with them any personal information. This ensures security and the merchants are protected from any potential losses that might occur from fraud cases.
It is very hard to cheat using these cryptocurrencies due to its decentralised system and the existing blockchain system. It cannot be manipulated by anyone or any organisation thanks to it being cryptographically secure. All the computers have a copy of all the transactions and the computers are continuously talking to each other. This is the most secure way of doing it as no one can hack in and make changes.
If someone wanted to hack into the blockchain they would be wasting their time hacking into just one or a few computers, since the information on the majority of computers always wins. So in order to hack in they would have to hack 51% of the computers around the world that make up the blockchain to make a change. The computational power required to do this is prohibitive.
Also it would take some time. The blockchain updates or refreshes its data every few minutes, giving a would-be hacker a few minutes window to hack in before everything is reset. After that they would have to start again. So not only would they have to hack into 51% of the thousands of computers around the world that make up the blockchain, but they would also have just a few minutes window to do it in.