Programming Languages of Cryptocurrencies

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    • Programming languages help crypto platforms and protocols run effectively.

    Key Points

    • The crypto ecosystem sits on top of distributed ledgers, which are broadly called blockchains
    • Smart Contract: 
      • Apart from recording and verifying transactions, some crypto blockchains like Ethereum let users launch agreements or special actions that execute on their own. 
      • These are known as smart contracts and to create them effectively, programming languages are a must.

    Important Programming Languages

    • C++:
      • C++ is a programming language commonly associated with Bitcoin
      • While the Bitcoin whitepaper explaining the peer-to-peer electronic cash system is written largely in English, the Bitcoin Core software, which makes transactions possible, uses C++. 
      • It is maintained by a community anyone can join by running Bitcoin Core full nodes. 
      • It is also one of the most used programming languages, playing a role in the development of operating systems like MacOS and Windows, gaming devices, search engines, and even machine learning. 
      • C++ is a major influence for many other programming languages in use today.
    • Solidity:
      • Solidity is the programming language mainly used on the blockchain platform Ethereum
      • Some of its developers are Ethereum co-founders. 
      • The language is influenced by C++, Python, and JavaScript. 
      • It is also known as a ‘curly bracket language’ as it uses the flower bracket special character. 
      • In recent times, with the Ethereum transition to a proof-of-stake model, programming skill in Solidity is expected to be in high demand. 
      • Parts of the Ethereum ecosystem also support several other programming languages such as Python, Ruby, Rust, Java, and more.
    • Rust: 
      • Rust has the unique distinction of being called the “perfect programming language” in 2021 by Twitter co-founder Jack Dorsey. 
      • In the crypto world, Rust is commonly associated with the Solana blockchain, which is known for its high speeds and relatively low transaction fees. 
      • The Polkadot blockchain, which helps to better connect blockchains with each other, also uses Rust. 
      • However, developers have complained that Rust is too difficult to learn. 
      • A 2018 survey showed that more than 22% of users did not feel productive using the programming language.
    • Python: 
      • Created by Dutch programmer Guido van Rossum, Python is a general-purpose programming language. 
      • Cryptocurrency is just one of its many use cases. 
      • It is used by developers who are interested in the Bitcoin Core as well as non-Bitcoin cryptocurrencies, known as alt coins
      • Python’s detailed library and graphic user interface options make it ideal for blockchain developers who are just entering the space to develop dApps. The programme can also be used widely by both Web3 and non-crypto-related app developers. 
    • Haskell: 
      • Cardano is a blockchain that takes pride in its academic rigour and scholarly approach to the crypto sector. 
      • Its smart contract programming language is based on Haskell
      • The Cardano Foundation itself admits that Haskell is not well-known, and that it is not a popular programming language for beginners. 
      • Haskell is classified as a purely functional programming language, and is hard to learn. But it is said to be well-suited to deliver accurate crypto projects due to its immutability feature.

    Significance of Programming Language in Crypto

    • Efficiency: Crypto exchanges, decentralised apps (dApps), the automated buying or selling of orders, and even NFT-based games often rely on smart contracts to run smoothly. A smart contract failure can cause platform outages, and exploitation of the codes could devalue the entire ecosystem. 
    • Understandability of C++: It is hailed for being an accessible programming language that users of Java, C, and C# can easily learn due to existing similarities.

    Cryptocurrency

    • It is a digital currency that can be used in place of conventional money.
    • In cryptocurrencies, cryptography is used to secure and verify transactions. It is also used to control the supply of cryptocurrencies.
    • It is supported by a decentralized peer-to-peer network called the blockchain.
    • First cryptocurrency: Bitcoin, launched in 2009 by Satoshi Nakamoto.

    Benefits of Cryptocurrency

    • Inherent security:  Use of pseudonyms and ledger systems conceals the identities.
    • Low transaction cost: Very low fees and charges for transactions.
    • Lack of interference from the banking system: Outside ambit of banking systems.
    • Lower Entry Barriers: No entry barriers, unlike conventional banking systems.
    • Universal recognition: Lots of cryptocurrencies and acceptable in many nations.

    Concerns with Cryptocurrency

    • Security risks: Cyberattacks on wallets, exchange mechanism (Cryptojacking). 
    • Shield to Crime: Used for Illicit Trading, Criminal Activities, & organized crimes. 
    • Threat to the Indian rupee: If a large number of investors invest in digital coins rather than rupee-based savings like provident funds, the demand of the latter will fall.
    • Lack of Liquidity and Lower Acceptability: Outside the traditional banking systems.
    • Price Volatility:  Prone to price fluctuations & waste of computing power.
    • Lack of Consumer Protection: No Dispute Settlement Mechanisms and control of Securities and Exchange Board of India (SEBI).

    Source: TH