IN THE KNOW WEB3 AND THE DIGITAL TRANSFORMATION OF MONEY ISSUE 1 | WHAT IS CRYPTO & THE BLOCKCHAIN?
A PRODUCT FROM
IN THE KNOW
ISSUE 1 | WHAT IS CRYPTO & THE BLOCKCHAIN?
At St. Cloud Financial Credit Union, the Executive Team and Board of Directors are dedicated to actively listening to our valued members. As a not-for-profit financial cooperative, we have the unique advantage of being able to diversify our offerings to cater to the needs of a wide range of individuals, rather than just a select few. It is this spirit of attentiveness to our members that inspired us to launch our educational publication, "IN THE KNOW: Web3 Technology & The Digital Transformation of Money." Through our annual survey, we discovered that approximately one-fourth (20%) of respondents expressed a strong desire for more information on Digital Assets (Crypto), Blockchain, and Web3. These individuals either owned crypto, planned to invest, or wanted to learn more about the tokenized industry before investing. This demand for information from our members, coupled with the anticipated technological advancements over the next five years, reminded us of our responsibility to act as financial educators. Furthermore, the Board of Directors, in collaboration with the Executive Team, has formulated a Digital Asset Strategy to pave the way forward. Rooted in the needs and desires of our members, this strategy encompasses four key pillars: 1. Listen to our members 2. Educate members, staff, and the community 3. Safe Storage of Member Digital Assets (Coming Soon “CU – Digital Asset Vault”™) 4. Transactional capabilities for members to buy & sell Digital Assets We recognize that not all members may have an interest in learning about or engaging with the Blockchain and Digital Asset (Crypto) space, either currently or in the future, as we might anticipate. Just like with any other product or content we introduce. We understand and respect that individual preferences and interests may vary. However, considering the significant member interest in this area and the abundance of publications from esteemed financial authorities, such as the NCUA, in recent years, we believe it is our responsibility to offer impartial, fact-based education for the sole purpose of facilitating learning. We neither advocate for nor oppose blockchain, digital assets, or cryptocurrencies. Our objective is to equip our members with knowledge surrounding a subject that could potentially impact all of us to varying degrees as we progress forward. We are steadfast in our commitment to consistently serve our members and adapt to their needs, both in the present and the future. Since our inception, we have diligently managed our members' wealth and acted as a trusted custodian of their value as needed. Regardless of the size or scale of your assets, it is our duty to empower you in safeguarding the rewards of your hard work today and for years to come!
WHAT IS CRYPTO & THE BLOCKCHAIN
Blockchain is a secure and tamper-proof method of storing data. It operates as a decen- tralized ledger, where transactions are copied and shared among a network of connected computers (nodes). This technology serves as the foundation for various cryptocurrency networks, including Bitcoin and Ethereum, as well as numerous applications that are gaining significant popularity. Each block of transaction data within the blockchain contains a unique signature derived from the preceding block, creating an interlinked chain. Public blockchain networks are associated with a specific token or cryptocurrency, which serves as a means of payment for network participants and enables external entities to engage with the blockchain.
Cryptocurrency is a form of digital currency that serves as an alternative payment method, and it is generated through the utilization of encryption algorithms. The incorporation of encryption technologies allows cryptocurren- cies to function as both a medium of exchange and a virtual accounting system. To engage with cryptocurrencies, individuals require a cryptocurrency wallet.
BLOCKCHAIN IS: “Decentralized” meaning no single party has absolute power over the network, enhancing transparency, security, and resil- ience. Each network participant maintains a copy of the blockchain.
Bitcoin (BTC) stands as the leading cryptocurrency in terms of market capitalization, representing the most prominent application of blockchain technology. Ethereum, introduced in 2015, holds the position of the second-largest cryptocurrency and has propelled the (Blockchain) technology to new heights. Ethereum expands upon the fundamental principles of Bitcoin's blockchain, aiming to foster an ecosystem of decentralized applications (dApps), platforms, and digital assets. While Bitcoin is often likened to "digital gold," Ethereum is recognized as a pioneer in Web3 and the tokenization of assets, opening innovative possibilities for decentralized digital interactions.
ISSUE 1 | WHAT IS CRYPTO & THE BLOCKCHAIN?
ISSUE 1 | WHAT IS CRYPTO & THE BLOCKCHAIN?
KEY FEATURES & BENEFITS OF BLOCKCHAIN EXPLAINED Security and Immutability: Once a transaction is recorded on the blockchain, it becomes extremely difficult to alter or manipulate. The decentralized nature of blockchain, along with cryptographic techniques, ensures the integrity and authenticity of data, making it highly secure against hacking or unauthorized changes. Transparency and Trust: Blockchain technology promotes transparency by providing a public and distributed ledger where all transactions are recorded. This transparency enhances trust among participants as anyone can independently verify and audit the transactions and data on the blockchain. Decentralization and Peer-to-Peer Networks: Blockchain enables peer-to-peer interactions, allowing individuals to transact directly without intermediaries. This decentralized architecture ensures that no single entity has control over the network, making it resistant to single points of failure, and manipulation. Programmability and Smart Contracts: Blockchain platforms like Ethereum introduced programmability through the concept of smart contracts. Smart contracts are self- executing contracts with predefined rules and conditions encoded on the blockchain. They automatically execute actions when specific conditions are met.
This publication by St. Cloud Financial Credit Union and/or its employees is not personalized investment advice and is provided without considering the recipients' individual investment objectives, intentions or means. It is intended solely for educational purposes and does not constitute a recommendation or endorsement of any kind. Any commentary expressed in this publication from St. Cloud Financial Credit Union and its employees, is solely for educational use and should not be relied upon as advice. St. Cloud Financial Credit Union and its employees cannot guarantee the validity or accuracy of the information.
ISSUE 1 | WHAT IS CRYPTO & THE BLOCKCHAIN?
Page 1 Page 2 Page 3 Page 4 Page 5Made with FlippingBook - Online catalogs