Understanding What a Cryptocurrency Is
A cryptocurrency is a type of digital money that exists only online. It uses cryptography to secure transactions and operates without a central authority like a bank or government.
How Cryptocurrency Works
Instead of relying on a bank, cryptocurrencies use a decentralized system called a blockchain. This is a public record where every transaction is stored and verified by a network of computers.
Why Cryptocurrencies Exist
They were created to offer faster, global, and more private ways of transferring value. Some people use them for payments, while others see them as investments or tools for innovation.
The Role of the Blockchain
The blockchain ensures that coins cannot be duplicated or altered. It keeps transactions transparent and secure, allowing users to trade directly without intermediaries.
The Simple Takeaway
A cryptocurrency is digital money secured by technology instead of banks. It allows people to send, receive, and store value online in a decentralized way.