The Basics of Crypto Currency
Cryptocurrency comes under many names. You have probably read about some of the most popular types of cryptocurrencies such as Bitcoin, Litecoin, and Ethereum. Cryptocurrencies are increasingly popular alternatives for online payments. Before converting real dollars, euros, pounds, or other traditional currencies into Bitcoin, you should understand what cryptocurrencies are, what the risks are in using cryptocurrencies, and how to protect your investment.
What is Cryptocurrency?
Cryptocurrency is a digital currency, which is an alternative form of payment created using encryption algorithms. The use of encryption technologies means that cryptocurrencies function both as a currency and as a virtual accounting system. To use cryptocurrencies, you need a cryptocurrency wallet. These wallets can be software that is a cloud - based service o ris stored on your computer or on your mobile device.
How does cryptocurrency Work?
Cryptocurrencies run on a distributed public ledger called blockchain, a record of all transactions updated and iheld by currency holders.
Units of cryptocurrency are created through a process called mining, which involves using computer power to solve complicated matematical problems that generate coins. Users can also buy the currencies from brokers, then store and spend them using cryptographic wallets.
If you own cryptocurrency, you don't own anything tangible. What you own is a key that allows you to move a record or a unit of measure from one person to another without a trusted third party.
Cryptocurrency Examples
There are thousands of cryptocurrencies. Some of the best known included:
Bitcoin
Founded in 2009, Bitcoin was the 1st cryptocurrency and is still the most commonly traded. The currency was developed by Satoshi Nakamoto - widely belived to be a pseudonym for an individual or group of people whose precise identity remains unknown.
Ethereum:
Developed in 2015, Ethereum is blockchain platform with its own cryptocurrency, called ether (ETH) or Ethereum. it is the most popular cryptocurrency after Bitcoin.
Litecoin
This currency is most similar to bitcoin but has moved more quickly to develop new innovations, including faster payments and processes to allow more transactions.
Ripple:
Ripple is distributed ledger system that was founded in 2022. Ripple can be used to track different kinds of transactions, not just cryptocurrency. The company behind it has worked with var ous banks and financial instructions.
and many more.