Cryptocurrency is a digital and virtual currency that is secured by cryptography, making it almost impossible to fake or double spend. Many cryptocurrencies are decentralized networks based on blockchain technology – a distributed ledger implemented by a separate network of computers. A defining feature of cryptocurrencies is that they are generally not issued by any central authority, which theoretically gives them immunity from government interference or manipulation.
With bitcoin, each transaction is added to a “block“, which is then added to the end of a series of blocks, a “blockchain“, and no one tampering with the previous block once it is confirmed. Can. This is done through robust cryptography using something called SHA-256 cryptographic hash function.
What Are Cryptocurrencies?
Cryptocurrencies are systems that allow online secure payment, represented as virtual “tokens“, represented by internal ledger entries in the system. “Crypto” refers to various encryption algorithms and cryptographic techniques that protect these entries, such as elliptic curve encryption, public-private key pairs, and hashing functions.
Types of Cryptocurrency
The first blockchain-based cryptocurrency was Bitcoin, which remains the most popular and most valuable. Today, there are thousands of alternative cryptocurrencies with different functions and specifications. Some of these are clones or forks of bitcoin, while others are new currencies that were created from scratch.
Bitcoin was launched in 2009 by a person or group known by the pseudonym “Satoshi Nakamoto“. As of May 2021, more than 18.7 million bitcoins were in circulation, with a total market cap of approximately $ 712 billion.
Some competing cryptocurrencies resulting from the success of Bitcoin, known as “AltCoin“, include Litecoin, DogeCoin, and Ripple, as well as Ethereum, Cardano, and EOS. Today, the total value of all cryptocurrencies in existence is approximately 1.6 trillion dollars — Bitcoin currently represents more than 42% and Etherium around 18% of the total value.
Benefits of Cryptocurrencies
A bit of a misnomer, trustless is actually a virtue to explain that you can trust people more because you don’t need to trust anyone in particular. You can use the blockchain with confidence knowing that no one can tamper with it after your transaction is confirmed in the block (except for an attack on the network). You can also force someone to fulfill their obligations by using a “smart contract“.
Related to the point above, you can control and manage your own assets without any intermediaries involved. Just keep your private keys safe!
You can check every transaction that happened on most blockchains like Bitcoin, BSC, or Ethereum.
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You can transact at any time, rather than having to wait for bank opening/operating hours.
Where to Buy
Anyone can purchase cryptocurrency through crypto exchanges like Coinbase, Binance, WazirX, and many more.
If you are just planning to buy your first cryptocurrency then I will suggest you buy from the WazirX exchange as it is quite easy to use. You can deposit your money directly from your bank to your WazirX wallet or use P2P.
What Is Cryptocurrency FAQs
What Is Cryptocurrency in Simple Words?
Cryptocurrencies are systems that allow online secure payment that are represented as virtual “tokens”.
How Do You Get Cryptocurrency?
What Is the Point of Cryptocurrency?
Cryptocurrencies Many experts see blockchain technology as having serious potential for uses such as online voting and crowdfunding, and major financial institutions such as JPMorgan Chase (JPM) see the ability to reduce transaction costs by streamlining payment processing.
How Does Cryptocurrency Make Money?
Cryptocurrency allows online secure payments, which are denominated as virtual “tokens”, represented by internal ledger entries in the system. Investors can make money with cryptocurrency by mining bitcoins or simply selling their bitcoins at a profit.
What Are the Most Popular Cryptocurrencies?
Bitcoin is by far the most popular cryptocurrency, followed by other cryptocurrencies such as Etherum, Litecoin, and Cardano.
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