Cryptocurrency is a type of digital or virtual money unlike the cash in your wallet it has no physical coin or bill. It exists entirely on the Internet the easiest way to understand it is to look at the three main things that make it completely different from traditional money it operates without a middleman decentralization when you send money digitally today like through a bank or a mobile app that bank access as a middleman to verify that you actually have the money and to update the balances cryptocurrency doesn’t use instead it runs on a global network of thousands of computers, working together to verify transactions no single government bank or company controls it too. It uses an unchangeable, digital ledger the Blockchain if there is no bank, how do we know who owns what every single transaction is recorded on a shared public digital notebook called a Blockchain once a transaction is written into this ledger. It is locked in forever. It cannot be edited deleted or faked. Anyone can look at the ledger which keeps the system, transparent and honest three it relies on advanced math for security cryptography. The crypto part of the name comes from cryptography, which is the science of hiding or securing information highly complex math equation secure the network, making it practically impossible for hackers to counterfeit the digital coins or double spend the same money the most common examples bitcoin BTC launched in 2009 bitcoin was the very first cryptocurrency. It is often referred to as digital gold because there is a limited supply only 21 million bitcoins will ever exist and people use it to store value Dh B. It’s main purposes to act as a massive global computer network let’s developers, decentralized apps and smart contracts agreements that execute themselves automatically through code why do people use it? People generally use cryptocurrency for two main reasons one as an investment buyer, hoping the price will go up in the future so they can sell it for a profit because prices can swing wildly. It is considered a high risk investment It allows people to send money directly to anyone else in the world instantly with relatively low fees without needing permission from a bank or dealing with international currency exchange hassles
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