Cryptocurrency and Blockchain in a Few Words
Cryptocurrency and its underlying technology, blockchain, are revolutionary technologies, but often misunderstood.
I think it’s necessary to understand them because more and more things are digitized, so I’ll try to explain quickly how it all works.
What are Cryptocurrencies?
Cryptocurrencies are digital currencies that use cryptography for security and operate independently of a central bank. Cryptocurrencies are not physical, meaning they only exist in digital form. Transactions involving cryptocurrencies are recorded on a decentralized digital ledger called a blockchain, which is maintained by a network of computers.
Cryptocurrencies are created through a process called mining, where powerful computers solve complex mathematical problems to verify and record transactions on the blockchain. The most well-known and widely used cryptocurrency is Bitcoin, but there are thousands of other cryptocurrencies in circulation, such as Ethereum, Litecoin, Ripple, etc...
The purpose of cryptocurrencies is that they are decentralized, meaning they are not controlled by any government or financial institution. This gives users more control over their finances and allows for faster and more secure transactions without the need for intermediaries like banks.
