Chapter 5 - The internet and its uses

5.2 Digital Currency

Learning Objective 16/01/2023
• Understand the concept of a digital currency and how digital currencies are used.

Digital Currency
Currency that exists in electronic form only; it has no physical form and is essentially data
on a database.

It is a method of payment, but rather than exchanging physical coins and bank notes, the
payment is made electronically.
A central bank is needed to act as the "middleman"

Problems with centralization

• Confidentiality (Control of governments and central authorities)
• Security
Crypto Currency
- Use the power of their personal computers to process transactions. The reward for doing
so is that miners receive some of the transaction fees involved in the process of payment
made.
Learning Objective 18/01/2023
• Understand the process of blockchain and how it is used to track digital currency
transactions

Decentralisation - Cryptocurrency
• Traditional digital currencies are regulated by central banks and governments. This
means all transactions and exchange rates are determined by these two bodies.
• Cryptocurrency has no state control and all the rules are set by the cryptocurrency
community itself.
• The cryptocurrency system works by being within a blockchain network which means
it is much more secure.

Blockchain

A technology that sits behind all cryptocurrency transactions. It makes all sorts of
cryptocurrency safe to use.

Blockchaining - How cryptocurrency work?

• Blockchain is a decentralised database.
• All the transactions of networked members are stored on this database.
• The blockchain consists of a number of interconnected computers but they are not
connected to a central server.
• All transaction data is stored on all computers in the blockchain network.
Blockchaining - A chain of blocks
• When a new transaction takes place, a new block is created
• Blockchains = A collections of all transactions

What's inside one block?

Learning Objective 19/01/2023
• Explain how a range of solutions are used to help keep data safe from security
threats

Cyber Security
Cyber Security Solutions & Prevention

Access Level
• User will be assigned different levels of access depending on the role they have. It
ensures that users' behaviour can be controlled while they use a computer on a
network.
• When using databases, levels of access are important to determine who has the right to
read, write and delete data.
Anti Malware
Anti Virus
• Anti-virus software are constantly scanning documents, files and also incoming data
from the internet.
• They are designed to detect suspisious activity and files before they are opened or
stored / warn the user against opening the files.
Anti Spyware
Spyware is software that gathers information by monitoring a user’s activities carried out
on their computer.
Authentication
Authentication refers to the ability of a user to prove who they are.
• Password and user names
• Biometrics Authentication
• Two-step verification
• Credit Card & Hotel Card