Some crypto companies are fully compliant, fully regulated, and still can't keep their bank accounts. Learn why the financial system is quietly freezing them out.
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Why can't a fully compliant, regulated crypto business secure a bank account in 2025?
If you're operating in this space, you already know the answer. You've lived through it. You've submitted the documentation, walked through your AML procedures, and demonstrated your regulatory compliance… only to be rejected. Or worse still, waking up to find your existing account frozen, with no real explanation and no path forward.
This isn't about isolated cases or bad actors being weeded out. It's a pattern of systematic risk aversion that's creating real barriers to growth across the entire sector, and it's throttling one of the most significant financial innovations of our generation.
We're Tap, and we're building the infrastructure that traditional banks refuse to provide.
The Economics Behind the Blockade
Let's examine what's actually driving this exclusion, because it's rarely about the reasons banks cite publicly.
The European Banking Authority has explicitly warned against unwarranted de-risking, noting it causes "severe consequences" and financial exclusion of legitimate customers. Yet the practice continues, driven by two fundamental economic pressures that have nothing to do with your business's actual risk profile.
The compliance cost calculation
Financial crime compliance across EMEA costs organizations approximately $85 billion annually. For traditional banks, the math is simple: serving crypto businesses requires specialized expertise, enhanced monitoring, and ongoing due diligence. As a result, it's cheaper to reject the entire sector than to build the infrastructure needed to serve it properly.
The regulatory capital burden
New EU regulations impose a 1,250% risk weight on unbacked crypto assets such as Bitcoin and Ethereum. This isn't a compliance requirement; it's a capital penalty that makes crypto exposure commercially unviable for traditional institutions, regardless of the actual risk individual clients present.
In the UK, approximately 90% of crypto firm registration applications have been rejected or withdrawn, often citing inadequate AML controls. Whether those assessments are accurate or not, they've created the perfect justification for blanket rejection policies.
The result? Compliant businesses are being treated the same as bad actors; not because of what they've done, but because of the sector they're in.
The Real Cost of Financial Exclusion
Financial exclusion isn’t just an hiccup; it creates tangible operational barriers that ripple through every part of running a crypto business.
Firms that have secured MiCA authorization, built robust compliance programs, and met regulatory requirements can find themselves locked out of basic banking services. Essential fiat on-ramps and off-ramps remain inaccessible, slowing payments, limiting growth, and complicating cash flow management.
Individual cases illustrate the problem vividly as well. Accounts are closed because a business receives a payment from a regulated exchange. Others are dropped with vague references to “commercial decisions,” offering no substantive justification. Founders frequently struggle to separate personal and business finances, as both are considered too risky to serve.
The irony is striking. By refusing service to compliant businesses, traditional banks aren’t mitigating risk; they’re amplifying it. Forced to operate through less regulated channels, these legitimate firms face higher operational and compliance risks, slower transactions, and reduced investor confidence. Over time, this slows innovation, and raises the cost of doing business for firms that are legally and technically sound.
Debanking Beyond Europe: U.S. Crypto Firms Face Their Own Challenges
Limited access to banking services isn’t exclusive to Europe. Leading firms in the U.S. crypto industry have faced numerous challenges regarding the banking blockade. Alex Konanykhin, CEO of Unicoin, described repeated account closures by major banks such as Citi, JPMorgan, and Wells Fargo, noting that access was cut off without explanation. Unicoin’s experience echoes a broader sentiment among crypto executives who argue that traditional financial institutions remain wary of digital asset businesses despite recent policy shifts toward a more pro-innovation stance.
Jesse Powell, co-founder of Kraken, has also spoken out about being dropped by long-time banking partners, calling the practice “financial censorship in disguise.” Caitlin Long, founder of Custodia Bank, recounted how her institution was repeatedly denied services. Gemini founders Tyler Winklevoss and Cameron Winklevoss shared similar frustrations.
These experiences reveal a pattern many in the industry interpret as systemic risk aversion. Even in a market as large and mature as the United States, crypto-focused businesses continue to encounter obstacles in maintaining basic financial infrastructure. The issue became especially acute after the collapse of crypto-friendly banks such as Silvergate, Signature, and Moonstone; institutions that once served as key bridges between fiat and digital assets. Their exit left a gap few traditional players have been willing to fill.
Why Tap Exists
The crypto industry has reached an inflection point. Regulatory frameworks like MiCA are providing clarity. Institutional adoption is accelerating. The technology is proven and tested. But the fundamental infrastructure gap remains: access to business banking that actually works for digital asset businesses.
This is precisely why we built Tap for Business.
We provide business accounts with dedicated EUR and GBP IBANs specifically designed for crypto companies and businesses that interact with digital assets. This isn't a side offering or an experiment, it's our core focus.
Our approach is straightforward
We built our infrastructure for this sector
Rather than retrofitting traditional banking systems to reluctantly accommodate crypto businesses, we designed our compliance, monitoring, and operational frameworks specifically for digital asset flows. This means we can properly assess and serve businesses that others automatically reject.
We price in the actual risk, not the sector
Blanket rejection policies exist because they're cheap and simple. We take a different approach: evaluating each business based on their actual controls, compliance posture, and operational reality. It costs more, but it's the only way to serve this market properly.
We're committed to sector normalization
Every time a legitimate crypto business is forced to operate without proper banking infrastructure, it reinforces outdated stigmas. By providing professional financial services to compliant businesses, we're helping demonstrate what should be obvious: crypto companies can and should be served by the financial system.
It isn't about taking on risks that others won't. It's about properly evaluating risks that others refuse to understand.
Moving Forward
The industry is maturing. Regulatory clarity is emerging. Institutional adoption is accelerating. But you can't put your business on hold while traditional banks slowly catch up to reality.
That's not sustainable in the long run.
As a firm, you shouldn't have to beg for a bank account. You shouldn't have to downplay your crypto operations just to access basic financial services. And you certainly shouldn't have to accept that systematic exclusion with little to no explanation other than “It’s just how things are."
The crypto sector is building the future of finance. Your banking partner should believe in that future too. If you're ready to work with financial infrastructure built for your business, not in spite of it, here we are.
Talk today with one of our experts to understand how we can help your business access the banking infrastructure you need.
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Investing has become an increasingly important part of many people's financial plans, as it offers the potential for greater returns than simply leaving money in a savings account. By investing your hard-earned money, you can potentially build wealth over time and secure a better future for yourself and your family.
But what exactly is investing? Put simply, investing involves putting your money into assets with the goal of making more money. There are various types of investments available to individuals, from stocks and bonds to mutual funds and real estate investments. Understanding how each type works is key to making smart investment decisions that will help you meet your financial goals.
Investing can also involve investing in time and labor, especially when it comes to business operations. These investments are similar in that one expects to see returns. While no investment carries a guarantee, understanding what they are and how they operate will assist you in making smart financial decisions.
What is an investment?
When you invest, you're essentially trading current resources (like time or money) for an asset that has the potential to grow in value. Ideally, if you choose to invest in the right asset at the right time, your investment could gain value. As an example, when you trade on the stock market, you are buying stock with capital in the hope that in time the asset will grow in value and sell for more money than the initial capital investment.
There are plenty of different types of investments one could use to grow their money, from stocks and bonds to commodities and cryptocurrencies, as well as mutual funds and real estate properties. The concept behind every investment is that it will make more money for the investor in the long term.
A smart investment allows an individual to not only make money but increase their total net worth. However, it's crucial to remember that every type of investment is speculative and there is always a possibility you will lose some or all the money you put in. For example, if you purchase stock shares or a piece of property, the value could decrease soon after you buy it. For this reason it is imperative that one assesses their risk tolerance before investing in something so as not to lose money.
The definition of an investment is not constant and can change depending on the situation. For instance, in macroeconomics, investing refers to purchasing items now that will be used later to generate income. While a company or individual from one nation might invest in business properties located in another country, such as building a factory which is known as foreign direct investments.
What are the different types of investments?
With a variety of options available, each investment type carries its own potential for returns, risks, and other factors such as tax implications and management fees. Below we highlight several options available to the everyday trader that can be used individually or together as part of an investment strategy to contribute to their financial goals.
Stock Market
By investing in stocks on the stock market, you are purchasing fractional ownership of a public listed company. People generally invest in stocks with the aspiration that their value will have gone up by the time they sell them. In order to make a profit from selling stock, the price will need to have grown enough to cover any trading costs and transaction fees associated with the trade.
Investing in certain stocks might also make you liable to dividend payouts, where a company distributes profits to shareholders (holders of stock) based on the company's performance.
Read more about investing in stocks in our What Are Stocks article.
Mutual funds
Mutual funds are investment vehicles that pool the money of many investors and invest in a variety of different assets such as stocks, bonds, and other securities. A mutual fund is managed by an investment professional who makes all the decisions about where to put the money within the fund.
These professionals seek to maximize returns for investors while maintaining a certain level of risk. Mutual funds are a great way for investors to diversify their portfolios, as the fund’s holdings may include stocks from many different companies and sectors. Additionally, mutual funds reduce the amount of research required to make an informed investment decision since all decisions are made by the fund manager. Investing in a mutual fund may come with higher fees than other investments.
Bonds
By purchasing a bond, you are essentially loaning money to a government, company, or other borrowing entity. In return for your loan, the debtor (the bond issuer) is required to repay both the debt and any associated interest payments.
However, it's worth noting that on occasion companies and countries default on their bonds, meaning that they can't make scheduled payments to the bondholders which will result in the investor losing money. This is almost always a last resort option as these establishments know that defaulting will scare off investors going forward.
A bond is a fixed-income instrument that pays periodic interest payments until the agreed-upon end date when the final payment is made and the loan's original amount is repaid.
Commodities
Commodities are raw materials that can be traded for one another, such as gold, beef, and gas, expanding to foreign currencies and indexes. Funds that invest money in commodities will typically invest in resources such as precious metals (silver, gold), energy resources (natural gas, oil), and primary agricultural products (wheat).
Cryptocurrencies
Cryptocurrencies are digital assets that are operated on decentralized networks free from government or financial institutional control. While considered high-risk, several cryptocurrencies (such as Bitcoin) have shown incredible gains over the last decade. Various investment accounts in mainstream firms are starting to incorporate cryptocurrencies into their portfolio.
Other investment options (real estate investments, etc)
Other investment options include real estate, options, futures, and certificates of deposit.
Before investing in any of the asset classes mentioned above it is imperative that one understands the financial instruments and their own risk tolerance entirely, as well as the terms involved in the investment, the fees or transaction costs and the risks involved.
It is also important for savvy investors to understand the tax implications of their investments and the capital gains tax they might be required to pay on any investment returns.
How do investments work?
While each asset class might differ slightly, they all require an upfront investment of capital. The intention is that this will later create a return in a monetary form of higher value.
When investing in financial products such as bonds, stocks, or a mutual fund, investors will typically have to set up an investment account with a professional such as a brokerage firm or money manager. This person can then advise on which products to invest in and manage your portfolio.
Investing in real estate will involve buying a house, usually done by making a down payment or investing in real estate investment trusts. These properties can either be used to live in or rent out and generate future income. The intention here is that the house appreciates in value over a certain period of time and can later be sold at a higher price. Depending on the property and area these types of investments can range from high risk to low risk.
How investments drive economic growth
Investments are not just for personal or corporate benefits, they play a big role in driving the broader economy. Through factors like building consumer demand and job creation, investing can play a direct role in economic growth.
For instance, a company might decide to sell stocks and issue corporate bonds in order to raise capital. This capital can then be used to build a factory, create a new product line and hire new employees. This then drives the greater economy while also building the company's and investors' wealth.
In another example, governments might use the funds raised from corporate bonds to fund public projects, fix the roads, or build social programs in communities. Or individuals might use gains made from investments to further their education or save for retirement. With more income comes more consumerism, in turn contributing to economic growth.
How to start investing
If you're ready to start investing, you will first need to determine your risk tolerance and which asset class you wish to pursue. If you're just starting out, start small and grow instead of taking on too many things at once. Gaining an understanding of your risk tolerance will help you to navigate where start investing.
Research
Before you begin, ensure that you have a thorough understanding of the market you wish to invest in, and understand all the associated risks. Always do your own research, and don't rely on one outlet or individual to be the sole source of information. If the option is available, consider hiring a professional to assist you.
Understand market movements
Another important aspect to understand before investing is that markets will always have fluctuations. Even if they grow over long periods of time, they will still go through periods of increases and declines. Don't rely on past performances to dictate future outcomes.
Open an account
To get started in investing you will need to open an investment account that allows you to both buy and sell the financial instrument. Looking at investing in stock, some investors will open a brokerage account that will execute trades on their behalf, while others might use a portfolio manager who oversees all their investments. Always do your research before parting ways with your money.
Have your financial affairs in order first
While investing is designed to create wealth, it is important to have a grasp on your personal finance beforehand, and ideally have an emergency fund set up for any unforeseen expences (so that you won't have to tap into your investment accounts).
Conclusion
An investment is the act of buying an asset with the intention that it appreciates in value over time. Before people invest it is imperative that one establishes their risk tolerance to establish how much risk one has to navigate.
Investments can be managed by professionals or individually, depending on the investors preference. It is also important to note that return on investments will typically be imposed by capital gains taxes, depending on the jurisdiction.
Det är aldrig för sent att lära sig om det nya sättet att tänka kring pengar. Bitcoin har blivit allt mer populärt för varje år, och med en växande användarbas är det en bra tid att bekanta sig med världens första – och största – kryptovaluta.
Vad är Bitcoin?
Bitcoin är ett peer-to-peer-betalningssystem som fungerar över internet – helt utan att kontrolleras av en bank, stat eller central myndighet. Det här digitala systemet gör det möjligt att skicka pengar direkt mellan två personer, utan mellanhänder, dyra avgifter eller långsam administration.
Istället för att styras av en central aktör drivs Bitcoin av ett nätverk av datorer över hela världen som följer samma regler (protokoll). Det är blockkedjetekniken (blockchain) som ligger bakom, och som ser till att alla transaktioner är säkra, transparenta och omöjliga att manipulera i efterhand.
Bitcoin är alltså en säker, decentraliserad och gränslös digital valuta – tillgänglig 24 timmar om dygnet, alla dagar i veckan.
Precis som guld har Bitcoin kallats en alternativ värdebevarare. Även om kryptovalutor fortfarande är föremål för regleringsfrågor används Bitcoin dagligen över hela världen, både som investering och betalningsmedel.
Vilka är fördelarna med Bitcoin?
Bitcoin förändrade sättet vi kan hantera pengar på. Med hjälp av internet och blockkedjeteknik skapades ett helt nytt finansiellt ekosystem.
Här är några av de viktigaste fördelarna:
- Decentraliserat: Ingen kan frysa konton, stoppa transaktioner eller kräva dokumentation – nätverket styrs inte av någon central aktör.
- Tillgängligt för alla: Det enda du behöver är en internetuppkoppling – inga bankkonton eller godkännanden krävs.
- Transparent: Alla transaktioner loggas öppet på blockkedjan i realtid, vilket skapar en tydlig spårbarhet.
- Likviditet: Bitcoin handlas på hundratals börser världen över, vilket gör det enkelt att köpa, sälja eller växla.
Hur fungerar Bitcoin?
Bitcoin fungerar genom att använda ett decentraliserat nätverk och blockkedjeteknik. Det låter komplicerat – men här är en förenklad förklaring:
Tänk dig att Amal vill skicka 1 BTC till George. Hon öppnar sin Bitcoin-plånbok, anger Georges plånboksadress och summan. Bitcoin lagras i digitala plånböcker, som består av två delar:
- En publik nyckel (plånboksadress)
- En privat nyckel (som fungerar som en PIN-kod – endast ägaren känner till den)
När Amal skickar transaktionen går den ut till nätverket. Där tävlar s.k. miners om att verifiera den genom att lösa ett matematiskt problem. Den första som lyckas får bekräfta och lägga till transaktionen i blockkedjan.
Transaktionen bokförs i ett nytt "block" med information om belopp, tidpunkt och plånboksadresser. När blocket godkänts uppdateras plånbalansen.
Oftast krävs tre bekräftelser (confirmations) innan pengarna kan användas vidare.
Vad ger Bitcoin sitt värde?
Värdet på Bitcoin styrs av utbud och efterfrågan. När efterfrågan ökar och utbudet är begränsat – ja, då stiger priset.
Från start programmerades det in att det aldrig kommer finnas mer än 21 miljoner BTC. Det här gör Bitcoin till en deflationär valuta, till skillnad från traditionella valutor som kan tryckas obegränsat.
Många ser idag Bitcoin som en slags digital motsvarighet till guld – en tillgång man håller långsiktigt för att bevara värde. Detta kallas ofta att "hodla" inom kryptovärlden.
Vad används Bitcoin till?
Bitcoin kan användas som:
- Betalningsmedel – skicka pengar var som helst i världen, dygnet runt, på bara några minuter.
- Värdebevarare – spara långsiktigt i en decentraliserad och global tillgång.
Tusentals handlare accepterar idag Bitcoin, och allt fler använder det som ett alternativ till både kontanter och bankkonton.
Vem skapade Bitcoin?
Bitcoin presenterades för världen den 31 oktober 2008 i ett dokument (whitepaper) signerat av en anonym person – eller grupp – vid namn Satoshi Nakamoto. Själva nätverket lanserades i januari 2009.
Satoshi skrev att Bitcoin var ett svar på den globala finanskrisen. Syftet var att skapa en valuta som inte kunde kontrolleras av banker eller regeringar, och som istället gav människor direkt ägande över sina pengar.
2010 försvann Satoshi från det offentliga – och ingen vet idag vem personen (eller gruppen) var. Trots många spekulationer är identiteten fortfarande ett mysterium.
Sedan dess har över 12 000 kryptovalutor lanserats. Alla andra kryptovalutor kallas altcoins (alternative coins), och exempelvis Ethereum skapades för att bygga decentraliserade appar (dApps), medan Litecoin utvecklades för att förbättra betalningstekniken bakom Bitcoin.
Hur köper man Bitcoin?
Att köpa Bitcoin är enklare än många tror. Med Tap-appen kan du:
- Skapa ett konto
- Verifiera din identitet
- Börja köpa BTC – direkt från mobilen
Appen erbjuder en säker plattform för att köpa, sälja, lagra och växla Bitcoin – och många andra kryptovalutor.
👉 Läs vår guide om hur du kommer igång med att köpa Bitcoin här
When it comes to understanding Bitcoin, an important aspect to get familiar with is the mining of it. As we explore what is Bitcoin mining and how does it work, we aim to empower you with a greater understanding of how the network functions as well as how blockchain technology facilitates the operations on the backend. Adaptable to many industries outside of the cryptocurrency space, blockchain technology is at the forefront of the tech revolution. Understanding how Bitcoin mining works is the first step to understanding the technology too.
What does Bitcoin mining entail?
Forget about shovels and dark tunnels, Bitcoin mining is the decentralized manner in which transactions are verified and new coins are minted. Mining also plays a vital role in the maintenance and operation of the network, ensuring both the security and integrity of the platform at all times. The actual process of Bitcoin mining involves miners using sophisticated computers to solve complex cryptography problems.
The Bitcoin network is made up of a number of nodes (computers) and miners around the world that communicate with each other and constantly share the updated record of the blockchain. The blockchain stores all transactions in a transparent and immutable manner, allowing anyone to view it from wherever they are, however, no one can make any changes.
How does Bitcoin mining work?
Let’s say someone in Japan wants to send money to someone in America through the Bitcoin network. The user in Japan would initiate a transaction from their chosen wallet, pay a network fee, and execute the transaction. This transaction would then enter a mempool, a pool of transactions that are waiting to be confirmed. Typically mempools work on a “first come first serve” basis, however, users can opt to pay a higher network fee should they want to push their transaction further forward in the que.
Miners will then pick up a number of transactions in the mempool and attempt to solve the complex cryptographic puzzle that will lead them to mining the block. The first miner to solve the puzzle is rewarded with the task of verifying the transactions and adding them to a block, in turn receiving the network fees as well as the block reward. Each block on the Bitcoin network can hold 1MB of transactional data.
While many miners will attempt to solve the math problem using their own resources, only one miner will be successful. This has sparked a conversation, largely fueled by Elon Musk’s recent tweet, over the electricity consumption it takes to mine Bitcoin. Tesla, the company that Musk heads, recently withdrew Bitcoin from their payment options due to the un-eco friendly manner in which the network operates, as it goes against their company ethos.
Once the miner has verified the transactions, ensuring that the wallet addresses exist and that there are available coins in the senders’ account, all the transactions are added to a block. This block is then added to the blockchain after the most recently added block, each block indicating the hash code of that block and the block before. This ensures that no one can tamper with the order or edit the content of any blocks.
The user in America will then receive a notification confirming that their wallet has received the BTC, however it will need to go through three confirmations (sometimes more) before being accessible. Each confirmation is represented by a new block added to the blockchain following the block with your transaction.
What is a block reward?
The block reward is a monetary reward given in Bitcoin to the miners for adding a new block to the blockchain. It is also the process used to mint new coins and in the process enter them into circulation. Alongside the block rewards, the miner responsible for adding the new block to the blockchain will also receive the network fees of each transaction verified within that block.
This makes Bitcoin mining a lucrative endeavour, however, the start up costs are significant and your success rate will depend on the equipment, power, and cost of electricity in your area.
What is the halving mechanism?
As Bitcoin will only ever have 21 million coins released, Satoshi Nakamoto created a mechanism that ensures the slow release of coins over time. This is called the halving mechanism, and it automatically executes every 210,000 blocks. During the halving the block reward is halved, ensuring that the cryptocurrency remains deflationary in nature.
This means that for every 210,000 blocks added to the blockchain, the block reward given to the miners will halve. To date there have been three halvings in Bitcoin’s history, with the last one taking effect in May 2020. The block reward is currently 6.25 BTC for every block added to the blockchain.
Want to enjoy the benefits of Bitcoin without mining?
There’s another way to get in on the Bitcoin action without the use of sophisticated hardware and high electricity consumption. Users can tap into the Bitcoin network by buying BTC directly from their phones through the Tap Global app. The process is simple, takes minutes, and allows you to own your very own BTC. Through the Tap app users can also trade, store and spend their cryptocurrency, with advanced technology facilitating the process on the backend to ensure smooth and secure trading.
While you’ve likely come across the world of cryptocurrencies, you most probably have stumbled upon the term “blockchain”. But what is the blockchain solution? Blockchain is not only the revolutionary technology behind cryptocurrencies, it also has a large use case outside of the cryptocurrency and even the finance sector.
In the decade since blockchain technologies and digital ledger technology came to light, a host of blockchain networks have been created, most with their own digital currency. As the industry has grown and new blockchain networks have emerged, innovation in the space has increased significantly.
From the Ethereum blockchain providing a platform on which developers can create digital assets and smart contracts to corporate organizations implementing a private blockchain in order to streamline their services, the technology is propelling mankind forward in ways not witnessed in decades.
The blockchain solution provides much more than just digital assets, and industries far beyond just the payment processing ones are catching on. With traditional business networks incorporating the technology, the world of permissioned blockchain is igniting.
What is Blockchain?
Blockchain is a decentralized, transparent, immutable technology that keeps a public record of all information entered. Designed to record and distribute information, not to be edited. Also referred to as a public ledger, a blockchain keeps a record of all information ever inputted and stores it chronologically in blocks.
These blocks are linked to each other through a hashing system, which ensures that no one can ever tamper with the previous records, or try to manipulate the information on them. The “chain” of blocks make up the blockchain database.
The decentralized technology is not typically run by one entity, but rather from a variety of computers (also known as nodes) that make up the network, and work together to validate transactions and all information added to the blocks. Blockchain can be used in two forms, as a public blockchain or as private blockchain networks.
The public version allows anyone to view all information on the network, while the private reserves the information for members granted access.
The Advantages of Blockchain Technology
Powerful Technology
Invented in 2008 alongside Bitcoin by an anonymous entity Satoshi Nakamoto, blockchain is the technology that fueled the new way that money is transacted. Not only that, the technology offers incredible use cases far beyond the financial world.
Fully Trusted, Fully Automated
One of the key features of blockchain is its ability to function without a central authority. The technology is designed to be maintained by various operating systems on the network, with full autonomy dispersed evenly. Information is stored on the blockchain in such a way that everyone can view it but no one can go back and tamper with it.
Powering Industries
While blockchain is the technology behind crypto, it also offers an incredible backbone to a diverse range of industries outside of this space. Companies like Nestle, Microsoft and Walmart are onboarding blockchain, proving to offer a strong and highly adaptable infrastructure to financial, property, and supply chain management entities. The number of blockchain companies is growing by the day.
The Core Benefits of a Blockchain Network
Decentralized
Blockchain networks are designed to be entirely decentralized meaning that there is no one central authority. The entire network is maintained by nodes (computers) around the world and no single entity has control.
Immutable
Once the information has been added to a blockchain, no one can tamper, edit, or remove it. As information is verified and added to blocks, this solidifies its presence on the blockchain forever.
Transparent
Blockchain offers a transparent view of all the activity that takes place on the network. This takes away the need for any checks or balances as all the information is available at any given time, in real-time.
What is the Difference Between a Public Blockchain and Private Blockchain?
When understanding what is blockchain, a common question is whether blockchain is secure. The answer is yes, blockchain is very secure.
Due to its decentralized nature, the technology requires a network of operators (computers) to verify and input all the information. As soon as one tries to input incorrect information or conduct illicit transactions, the network will recognize this and reject it immediately.
The difference between a public and private blockchain is that public blockchain networks are open for anyone to see, while private blockchains are closed to an organization or a selected group of people.
Cryptocurrency networks are examples of public blockchain networks in that anyone can view all the transaction data. For a private blockchain, however, users will need special permission to access this information.
How is Blockchain Tamperproof?
Each block is made up of three things: the hash code of the previous block, the relevant information, and its own hash code.
When a new block is added, the new block will again have the hash of the previous block, the relevant information, and its own hash. This special sequence of hashes ensures that all blocks are stored chronologically, in a linear fashion, meaning that you cannot tamper with one block's information without tampering with every block after that.
Tampering with blocks would take an enormous amount of computing power and is largely considered impossible. Hence the security of using a digital asset or digital currency.
Blockchain Explained: How Does It Work
At its core, blockchain records and distributes information to a wide network of users that participate in verifying the information and maintaining the network. Let’s take a deeper look at Bitcoin transactions to further explain how blockchain works.
If one user wanted to send a portion of Bitcoin to another user, they would require the user’s wallet address. Each wallet is made up of two codes, a public and private key, which enable the user to receive BTC (through the public key), as well as access BTC and conduct transactions (through the private key). The sender will then input the receiver’s wallet code and send the amount of Bitcoin they desire.
This transaction will then enter a pool of transactions waiting to be verified by a miner on the network. The miner will ensure that the sender owns the amount they are sending, and verify the transaction along with a number of other transactions.
On the Bitcoin network, the size of one block is 1MB, which equates to roughly 3,200 transactions able to be stored in one block. When building a blockchain network, the size of the blocks can be increased or decreased to suit the use case.
Once the transaction has been verified, the miner will record transactions processed and ensure they are added to the chain. The transaction ledger will then be distributed to the rest of the operators on the network. This new version will then override the older versions, and so on as more blocks are added.
Once the block is added to the blockchain and distributed, the funds will reflect in the receiver’s wallet. No need for a bank account or legal contracts, Bitcoin (and other digital currencies) operate entirely separately from traditional banking institutions and allow for the fast, efficient and cost-effective transaction of value.
Fraudulent transactions cannot take place as this will be flagged long before the block is added to the chain. Blockchain work in such a way that network participants can immediately flag ill actors and dismiss fraudulent financial transactions.
Understanding the Difference Between Blockchain and The Bitcoin Blockchain
The burning question: how does blockchain compare to Bitcoin. The answer is that it doesn’t, there are two separate, co-dependent technologies. Bitcoin, the cryptocurrency, is built on blockchain technology and requires it to function. There is no Bitcoin without blockchain technology.
Consider it the backbone of all cryptocurrencies. Blockchain technology, however, is an adaptable technology that can be used outside of the cryptocurrency industry. The technology can be used in any industry, provided that they require a transparent, immutable public ledger.
One thing the two do have in common is that they were both introduced to the world at the same time. While the concept of blockchain technology was initially invented by researchers W. Scott Stornetta and Stuart Haber in 1991, it was referred to as distributed ledger technology (DLT) and was created purely to store office documents.
The anonymous entity Satoshi Nakamoto built on this and ultimately solved the double spending problem it was plagued with. In 2008, Nakamoto released both blockchain technology and Bitcoin in a whitepaper titled Bitcoin: A Peer-to-Peer Electronic Cash System.
The Bitcoin blockchain refers to the network, while blockchain technology refers to the technology as a whole.
In Conclusion
What is blockchain? Blockchain technology is the transparent, immutable storage of information. As mentioned earlier, this technology has use cases far outside of just the cryptocurrency and financial ecosystems.
Industries like renewable energy, supply chain management, and even farming sectors are now incorporating blockchain technology into their business systems, empowering them with a fully automated and safe means of storing records.
A consistent member of the top 10 biggest cryptocurrencies by market cap, Cardano has earned itself an impressive position in the market. The innovative project was developed by a team of brilliant minds, including the co-founder of Ethereum, Charles Hoskinson, and aims to be the next generation of Ethereum. Let's explore what Cardano is and why has become a popular cryptocurrency.
What is Cardano?
Cardano is the blockchain platform that has taken the industry by storm since its launch. Alongside its cryptocurrency, ADA, Cardano provides developers with a platform on which to build decentralized applications (dapps) and smart contracts. Through a more scalable and sustainable model, Cardano seeks to improve on Ethereum's offering and propel the blockchain and crypto industry into a more eco-friendly future.
Cardano uses a Proof-of-Stake consensus to facilitate the network and is considered to be a third-generation blockchain platform (Bitcoin being the first, Ethereum the second). Unlike other blockchain platforms, Cardano does not have a whitepaper and instead relies on rigorous academic and peer-reviewed research. The platform has numerous ties with universities around the world, contributing to the funding of the development of blockchain research.
Who created Cardano?
Cardano was first conceptualized in 2015 and later launched in September 2017 by Ethereum co-founder, Charles Hoskinson. His goal was to build a highly scalable and energy-efficient smart contract platform. After leaving the Ethereum team, Hoskinson grouped together a team of expert engineers and academics and set out to build a layered blockchain platform from scratch.
Today, the platform is developed by a group of organisations that each focus on different elements of the business. The first is the Cardano Foundation which is responsible for standardizing, protecting and promoting the protocol technology. Input-Output Hong Kong (IOHK) focuses on building technological solutions centred around financial inclusion, while its sister company Emurgo is a global initiative designed to "support developers, startups and enterprises in developing blockchain solutions".
Together these companies assist in the growth and development of Cardano. While regulatory news and Bitcoin may be behind many altcoin price swings, Cardano has done well to establish its value in the crypto market and build a community that supports its goals.
How does Cardano work?
Through a Proof-of-Stake (PoS) mechanism known as Ouroboros, Cardano provides peer-to-peer transactions, dapp development and the creation of smart contracts. The layered architecture makes this possible, with one layer, known as the Cardano Settlement Layer (CSL) responsible for validating transactions and maintaining the ledger of balances while the Cardano Computing Layer (CCL) is responsible for the execution of all dapp computations via smart contracts.
The separation of these two layers allows the platform to offer lower fees, less network congestion and faster transactions. When thoroughly tested in 2017, Cardano was able to process 257 transactions per second (TPS), a large jump from Bitcoin's 4.6 TPS and Ethereum's 15 - 20 TPS.
Through its network of validators (known as a miner on a Proof-of-Work mining network) who each hold a stake in the network, Cardano is able to deploy smart contracts, facilitate the peer-to-peer exchange of value and provide the building blocks for dapp and token creation.
What is ADA?
Let's first cover where the name came from. ADA is a nod to the person regarded as the "world's first computer programmer", the 19th-century mathematician, Ada Lovelace. Cardano on the other hand was named after the 16th-century Italian polymath Gerolamo Cardano. Each phase in the project's development is named after famed historical characters pertaining to maths, physics and literature.
While ADA can be used as digital cash to conduct payments, the cryptocurrency has a wider range of uses. The native token to the platform's operations, ADA, can be used to facilitate transactions, as a store of value, to participate in staking functionality, and to pay transaction fees on the network.
ADA will also be used as a governance token in the future, allowing its holders the ability to vote on upgrades and changes on the platform. This is in line with Cardano's intentions to make the network entirely decentralized and community-driven, incorporating an automated treasury system that would oversee and execute all funding required.
Cardano's Roadmap
Another interesting element to the Cardano network is that all five development phases are consistently worked on at the same time, as opposed to moving on to the next once one is complete.
Of the five phases, each focuses on specific functionalities:
Byron - foundation (completed)
Shelley - decentralization (completed)
Goguen - smart contracts
Basho - scaling
Voltaire - governance
Where To Buy Cardano (ADA)
If you're looking to add ADA to your cryptocurrency portfolio, you can conveniently and securely buy the token through your Tap app. If you haven't done so already, simply download the app, complete the quick identity verification step and load your account with funds (crypto or fiat) with which you can buy ADA. The cryptocurrency will then be deposited into your unique ADA wallet, available for your perusal.
Cryptography is the process of converting messages into unreadable text so that only the intended recipient will be able to read them. Cryptography is responsible for the security, anonymity, and trust less transactions of digital currency. – entirely without the services of a financial institution.
We'll define cryptography as the study of methods to exchange sensitive information over an insecure channel in such away that only authorized parties can access it. In our case, this will be exchanging ownership of cryptocurrencies (which is represented digitally), or transferring ownership by signing digital messages.
A bit of history:
Cryptography dates back to the time when people began exchanging messages in forms other than face-to-face conversations(e.g., via written letters). The first known use of cryptography can be traced to Egypt, about 2000 years ago, during the reign of Pharaoh Thutmose III. Other known historical uses of cryptography are in the works of Julius Caesar, who used a simple cipher for messages between him and his generals.
The purpose of cryptography in crypto
A blockchain-based cryptocurrency needs some form of encryption to secure its money supply from being stolen by hackers or malicious software. It also allows for the anonymous transfer of funds between individuals without requiring a trusted third party, such as a bank or government institution. Cryptocurrencies are entirely based on cryptographic ideas.
Compared to cash transfers, cryptocurrencies do have another layer of security built into the blockchain: cryptography. The purpose of which is to validate transactions and prevent unauthorized access to the ledger by keeping all information inside a digital file that only authorized people can see. It's kind of like a physical vault (or safe) where you can keep all your money. But, unlike a physical vault, there's also no way to access the safe without a private key or password.
Usage of cryptography in Cryptocurrency
Cryptography is used in several different components of Bitcoin's security model, as well as in other cryptocurrencies.
Bitcoin addresses, which are used to receive and send funds between people on the blockchain, have both public keys and private keys. Only the owner of an address's private key can spend funds sent to the address, and only the owner of an address's public key will be able to receive them.
Every time you send or receive bitcoins, your transaction is signed with the appropriate digital signature using your private key. Since you can't share your private key with the person receiving your bitcoins, they verify that the signature is correct using your public key. The process of sending and receiving bitcoins between addresses is entirely anonymous and doesn't require any personal information (although there are ways to link transactions to identities).
Cryptocurrencies use public-key cryptography in order to prove ownership of addresses and transactions. This is done with a piece of data known as a digital signature, which is obtained using the sender's private key, and attached to the end of every transaction block along with other information about that block. Each new transaction has its own signature, verifying that the sender owns the address that is being used to send the funds. Since only the owner of a private key can create a digital signature for it, this provides a very strong guarantee that nobody else has sent their cryptocurrency to an address other than the one currently being spent from.