What is cryptocurrency?

The essence of cryptocurrency refers to a decentralized digital currency specifically designed for Internet use. Bitcoin, launched in 2008, was the first cryptocurrency and remains the largest, most influential and most famous cryptocurrency. In the decade since then, other cryptocurrencies such as Bitcoin and Ethereum have developed into digital alternatives to government-issued currencies.

The most popular cryptocurrencies by market cap are Bitcoin, Ethereum, Tether and Solana. Other well-known cryptocurrencies include Tezos, EOS and ZCash. Some cryptocurrencies are similar to Bitcoin. Other cryptocurrencies are based on different technologies or have new functions rather than just transferring value.

Cryptocurrency allows value to be transferred online without the need for intermediaries such as banks or payment processors, allowing value to be transferred instantly, almost 24/7, globally at low cost.

Cryptocurrencies are usually not issued or controlled by any government or other central authority. They are managed by a network of peer-to-peer computers running free open source software. Generally speaking, anyone who wants to participate can participate.

If banks or governments are not involved, how can cryptocurrencies be secure? Cryptocurrencies are secure because all transactions are reviewed through a technology called blockchain.

Cryptocurrency blockchain is similar to a bank\'s balance sheet or ledger. Each currency has its own blockchain, which is a continuous re-verified record of every transaction made using that currency.

Unlike bank ledgers, the cryptocurrency blockchain is distributed among participants throughout the digital currency network.

No company, state or third party has control over this; anyone can participate. Blockchain is a breakthrough technology that was only recently made possible through decades of computer science and mathematical innovation.

Key Concepts

Transferability

Cryptocurrencies make transactions as smooth and convenient for people far away as paying in cash at a local grocery store.

Privacy

When paying in cryptocurrency, you do not need to provide unnecessary personal information to the merchant. This means that your financial information is protected and will not be shared with third parties such as banks, payment services, advertisers and credit rating agencies. Moreover, since there is no need to send sensitive information over the Internet, there is a small risk that your financial information will be compromised or your identity stolen.

Security

Almost all cryptocurrencies, including Bitcoin, Ethereum, Tezos and Bitcoin Cash, are secured using a technology called blockchain, which constantly checks and verifies them through a large amount of computing power.

Portability

Since your cryptocurrency assets are not tied to financial institutions or governments, you can use cryptocurrency no matter where you are or what happens to major intermediaries in the global financial system.

Transparency

Every transaction on the Bitcoin, Ethereum, Tezos and Bitcoin Cash networks is publicly released without exception. This means there is no room to manipulate transactions, change the money supply, or adjust rules in the middle of the run.

Irreversibility

Unlike credit card payments, cryptocurrency payments cannot be revoked. For merchants, this greatly reduces the possibility of fraud. For customers, it has the potential to eliminate important disputes over high fees charged by credit card companies, making business transactions cheaper.

Networks supporting Bitcoin have never been hacked. The basic concept of cryptocurrency makes it secure: the system requires no license, and its core software is open source, so countless computer scientists and cryptographers can inspect all aspects of the network and its security.