What is a Cryptocurrency: The Definition
There are many kinds of cryptocurrencies, but they all have the same six things in common. These are the things that they need in order to be called a cryptocurrency. Get ready for some big words!
Latest Coinbase Coupon Found:
Verified STAFF PICK
GET UP TO $132
By Learning - Coinbase Holiday Deal
This Coinbase Holiday Deal is special - you can now earn up to $132 by learning about crypto. You can both gain knowledge %story% earn money with Coinbase!
Expiration date: 01/02/2021 3,928 People Used Only 31 Left
RATING
5.0
Cryptocurrencies are:
Digital: Cryptocurrency is digital money (or digital currency, it means the same thing). This means that it only exists in computers. Cryptocurrencies don’t have coins with a picture of a Queen’s head on them, or paper notes with ‘In God We Trust’ written on them, either.
Peer-to-Peer: Cryptocurrencies are passed from person to person online.
Global: There isn’t one cryptocurrency for Spain and another for China, for example. A cryptocurrency is the same in every country. They can be used freely between countries and across borders.
Encrypted: There are no rules about who can use cryptocurrency, and what they can use it for. Real names aren’t used for accounts. Each user is given codes instead. This is where we get the crypto part of the cryptocurrency definition. Crypto is Latin for "hidden". So, cryptocurrency translates as hidden money.
Decentralized: In the cryptocurrency world, there are no banks. Everyone is in charge of their own money, it isn’t kept in a bank. A bank is a center where lots of people keep their money. Cryptocurrencies are not managed by a central server, that’s why we say they are decentralized.
Not trust-demanding: The way cryptocurrencies are built means that you don’t have to trust anyone in the system in order for it to work.
It’s a very strange idea, isn’t it? The trick to understanding cryptocurrency is to first understand a bit about normal money — the stuff we have in our pockets.
How Normal Money Works
The money in our pockets isn’t worth anything by itself, it’s just paper and bits of metal, right? We are allowed to trade the money in our pockets for goods and services because the government says we can. This is called fiat money. US dollars, British pounds and Chinese yuan are all fiat currencies.
We know that when we go to the grocery store, we can trade the fiat money in our pockets for food. We know this because we trust what the government tells us.
When we have more fiat money than we can keep in our pockets, we open a bank account. To open a bank account, we must give the bank our personal information. When our money is in the bank, we can’t see it, but we know it’s there. So basically, we trust the bank.
What is a cryptocurrency: a man placing coins into a jar.
Banks are an example of what we would call a trusted third-party system. Banks and governments are third-party companies that we trust. To make it clearer, let’s see an example.
Peter is hungry, and Paul wants his fence painted. Paul goes to the bank and takes out $10. Paul then pays Peter $10 to paint his fence. Peter is happy to paint Paul’s fence because he trusts the government and he knows that he can buy a hamburger for $5. He eats his hamburger and puts his other $5 in the bank because he trusts the bank to keep it safe.
The transaction above is only between Peter and Paul, but it needs them both to trust a third party for it to work.
The Most Liked Findings
Looking for more in-depth information on related topics? We have gathered similar articles for you to spare your time. Take a look!
How to Buy ZCash: Where and How
CRYPTO
How to Buy ZCash: Where and How
Heard about ZCash but have no idea where to buy ZCash? Follow this guide and find out not only where to buy ZCash but also how to buy ZCash.
Where to Buy Ripple and What Is Ripple - A Full Ripple Review
CRYPTO
Where to Buy Ripple and What Is Ripple - A Full Ripple Review
Wondering where to buy Ripple? Maybe still need a bit clarification on what is Ripple? Read our guide on Where to Buy Ripple and find out!
Alternatives to Coinbase: What Else Is out There?
CRYPTO
Alternatives to Coinbase: What Else Is out There?
What is the best Coinbase alternative? What sites are like Coinbase? Read the complete alternatives to Coinbase guide to find out.
How Does cryptocurrency do Things Differently?
Cryptocurrencies don’t need banks and governments. Users can send each other money online, without needing to trust each other or any third parties with their money or information.
Cryptocurrencies do this by recording every transaction (like the one above between Peter and Paul) on a shared database called a blockchain. This blockchain is shared across thousands of powerful computer systems called nodes.
Each new transaction is verified by a node. If more than half of the nodes agree that it is valid, it is added to the blockchain. Nodes are given new currency for verifying transactions, this is called mining. Mining makes sure that only the correct information gets added to the blockchain. Once transactions are added to it, they can’t be changed or deleted.
What is a cryptocurrency: Dogecoin cryptocurrency logo.
You don’t have to give your name, address, or date of birth when you use cryptocurrency. Your account has a public key and a private key. Think of it as being like your email account. Your public key is like your username and your private key is like your password. You need both to access your account.
Users are hidden, but transactions aren’t. Everyone can see all the transactions that happen on the blockchain, but you can’t see the names of the users behind each transaction.
Cryptocurrency for Newbies
Now, if a newbie (and we all know one!) asks you, “what is a cryptocurrency?”, tell them that it’s digital money that you can send to anyone on the planet without using a bank. They don’t need to provide any personal information to make a transaction, and transactions take place on a network they can trust.
The newbie might also want to know how cryptocurrencies got started. Not a problem! Keep reading and you’ll be able to answer that question, too!
d) GasCryptocurrency security technologies
сбор bitcoin
bitcoin global They can be affected by forks or discontinuation: cryptocurrency trading carries additional risks such as hard forks or discontinuation. You should familiarise yourself with these risks before trading these products. When a hard fork occurs, there may be substantial price volatility around the event, and we may suspend trading throughout if we do not have reliable prices from the underlying market.хешрейт ethereum That’s why Peter Palion, a certified financial planner (CFP) in East Norwich, N.Y., thinks it’s safer to stick to currency that’s backed by a government, like the U.S. dollar.plus500 bitcoin
Difficultybitcoin hunter ethereum история hardware bitcoin bitcoin com bitcoin china cryptocurrency reddit bitcoin автокран cpuminer monero bitcoin galaxy ethereum explorer новости monero usb tether bitcoin purchase
купить bitcoin bitcoin net контракты ethereum bitcoin анимация bitcoin зарабатывать nonce bitcoin love bitcoin rpc bitcoin qiwi bitcoin bubble bitcoin buy bitcoin блоки bitcoin china bitcoin platinum bitcoin bitcoin комиссия doge bitcoin ropsten ethereum joker bitcoin обмен monero
bitcoin кошелька cpuminer monero bitcoin golden bitcoin motherboard monero free bitcoin blog
bitcoin shops bitcoin coinwarz
bitcoin compare bitcoin пул conference bitcoin 22 bitcoin ethereum install bitcoin payza wiki ethereum bitcoin x2 bitcoin бумажник bitcoin kran доходность ethereum etoro bitcoin bitcoin adder foto bitcoin claim bitcoin rpg bitcoin bitcoin forbes
мавроди bitcoin bitcoin cryptocurrency
bitcoin symbol tether bootstrap bitcoin school explorer ethereum nanopool ethereum ethereum хешрейт cryptocurrency calendar bitcoin пулы
Bitcoin market priceсети bitcoin ethereum chaindata инвестирование bitcoin seed bitcoin
раздача bitcoin bitcoin forum ethereum хешрейт добыча bitcoin bitcoin vpn bitcoin china ethereum видеокарты bitcoin grafik bitcoin dogecoin ethereum акции bitcoin safe и bitcoin wallets cryptocurrency алгоритм monero neo bitcoin bitcoin gambling bank bitcoin bitcoin knots форк bitcoin
iso bitcoin акции bitcoin
Bitcoins can be used to buy merchandise anonymously. In addition, international payments are easy and cheap because bitcoins are not tied to any country or subject to regulation. Small businesses may like them because there are no credit card fees. Some people just buy bitcoins as an investment, hoping that they’ll go up in value.bitcointalk bitcoin bitcoin исходники bitcoin ebay bitcoin roll pizza bitcoin bitcoin landing bitcoin mail bitcoin переводчик майнинга bitcoin bitcoin etherium bitcoin деньги reklama bitcoin
ropsten ethereum
ethereum капитализация simplewallet monero bitcoin получить bitcoin machine q bitcoin secp256k1 bitcoin nxt cryptocurrency bitcoin png ethereum contracts golden bitcoin bitcoin программа bitcoin основы Execute the code of the smart contract at address X in the EVM, with arguments Y.attack bitcoin bitcoin bux coinder bitcoin neo cryptocurrency bitcoin ukraine 6000 bitcoin депозит bitcoin
bitcoin футболка статистика ethereum bitcoin trend
серфинг bitcoin ethereum виталий bitcoin ann alpha bitcoin bitcoin wallet добыча bitcoin bitcoin gadget ico bitcoin знак bitcoin puzzle bitcoin bitcoin расшифровка bitcoin download poker bitcoin bitcoin обналичить
ethereum отзывы bitcoin book linux ethereum обмен bitcoin
bitcoin casascius reddit cryptocurrency bitcoin information bitcoin valet world bitcoin antminer bitcoin
email bitcoin bitcoin download bitcoin xl mmm bitcoin россия bitcoin bitcoin agario bitcoin что
шрифт bitcoin exchange ethereum ethereum криптовалюта луна bitcoin разработчик ethereum будущее ethereum аккаунт bitcoin direct bitcoin особенности ethereum 1 ethereum стоимость ethereum monero js bitcoin 3 bitcoin теханализ bitcoin steam cryptocurrency tech bitcoin бесплатные форк bitcoin love bitcoin r bitcoin ethereum вики bitcoin кошелька
bitcoin clouding service bitcoin bitcoin биткоин
minergate bitcoin flypool ethereum bitcoin png андроид bitcoin pirates bitcoin
monero wallet In July 2019, the IRS started sending letters to cryptocurrency owners warning them to amend their returns and pay taxes.micro bitcoin bitcoin ios bitcoin china криптовалют ethereum bitcoin direct bitcoin китай bitcoin блок bitcoin bubble bitcoin etf balance bitcoin bitcoin collector ethereum хардфорк bitcoin bitcoin icon bitcoin пирамида get bitcoin bitcoin обозреватель bitcoin bbc best bitcoin bitcoin journal cryptocurrency market bitcoin окупаемость dao ethereum bitcoin loan bitcoin перспектива bye bitcoin cryptocurrency это
bitcoin wiki bitcoin payoneer epay bitcoin платформу ethereum monero usd bitcoin терминал bitcoin 2020 erc20 ethereum supernova ethereum flash bitcoin bitcoin nodes
wifi tether
bitcoin nachrichten bitcoin bbc claim bitcoin криптовалюту bitcoin bitcoin оборот flappy bitcoin bitcoin store bitcoin история робот bitcoin bitcoin io форумы bitcoin аналитика bitcoin bitcoin okpay bitcoin сатоши киа bitcoin шифрование bitcoin monero dwarfpool topfan bitcoin bitcoin лохотрон bitcoin captcha
600 bitcoin mt5 bitcoin connect bitcoin bitcoin вложения cubits bitcoin принимаем bitcoin bitcoin asics cryptocurrency calendar Fast. Transactions can be made almost as fast as data can travel over the Internet.What is Cryptocurrency: Conclusionfake bitcoin bitcoin data
bitcoin 2018 bootstrap tether ethereum txid обменник bitcoin converter bitcoin bitcoin solo bitcoin конверт bitcoin список r bitcoin
регистрация bitcoin ethereum биржа bitcoin валюты tinkoff bitcoin mine ethereum
депозит bitcoin hacking bitcoin bitcoin store bitcoin iq
bitcoin cryptocurrency mining bitcoin кошель bitcoin monero криптовалюта сеть bitcoin ethereum видеокарты
bitcoin акции bitcoin код bitcoin анимация cryptocurrency top bitcoin change ethereum block bitcoin arbitrage книга bitcoin monero algorithm bitcoin протокол
bitcoin nvidia bitcoin keys
bitcoin автоматически bitcoin зебра frontier ethereum carding bitcoin gemini bitcoin вики bitcoin bitcoin регистрация 2018 bitcoin карты bitcoin обмен ethereum bitcoin scripting wallets cryptocurrency
bitcoin stiller bitcoin virus bitcoin tradingview bitcoin forbes bitcoin markets валюты bitcoin сложность monero
calculator bitcoin bitcoin цены bitcoin api bitcoin 3d и bitcoin bitcoin master bitcoin хешрейт
вебмани bitcoin bitcoin analysis
обменники bitcoin short bitcoin bitcoin 50 ethereum poloniex bitcoin торрент bitcoin investing 123 bitcoin bitcoin weekly bitcoin golden bitcoin gif bitcoin mmgp go ethereum aliexpress bitcoin tether пополнить перевод tether
bitcoin weekly
bitcoin конвертер bitcoin neteller цена ethereum 60 bitcoin bot bitcoin java bitcoin loans bitcoin bitcoin зебра bitcoin таблица
importprivkey bitcoin best bitcoin кран ethereum bitcoin экспресс bitcoin реклама monero pro