What is Cryptocurrency?

Cryptocurrencies are used as mediums of exchange, just like paper currencies. It’s like your bills and coins only in digital form.

The word is derived from the words “cryptography” and “currency”.

Cryptography is the art of “secret writing” involving complex mathematics and computer science. Cryptography involves the conversion of messages into complicated codes that prevents other people from deciphering the messages. It is used in electronic commerce, chip-based payment cards, digital currencies, computer passwords, and military communications.

By incorporating cryptography, cryptocurrency transactions are considered very secure.

Currency, on the other hand, refers to a medium of exchange and a unit of account. It is used to represent value.

Thus, cryptocurrency is used to transfer value using the internet between two parties which is made secure by cryptography.

Bitcoin is considered the first cryptocurrency created. It was created by an anonymous person/group using the moniker “Satoshi Nakamoto” in 2008. Bitcoin remains to be the dominant cryptocurrency but there are thousands that have already been created since then.

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