Understanding the Concept and Types of Cryptocurrency

Understanding the Concept & Types of Cryptocurrency

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Someone in your life, perhaps your lover or best friend, is discussing cryptocurrency.

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At its most basic level, a cryptocurrency is a digital asset that uses computer code and blockchain technology to run autonomously, without the need for a significant party to control the system, such as a person, company, central bank, or government.

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A blockchain is a distributed ledger that records bitcoin transactions.

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Bitcoin, the first cryptocurrency, was founded to serve as an online payment system.

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Coins run on their blockchain and have value because they are utilized as a medium of exchange.

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Tokens, on the other hand, are based on a previously established blockchain.

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Reducing corruption: Cryptocurrencies aim to overcome the problem of absolute power by dividing it among many persons or, better yet, across all network participants.

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With traditional money, a middleman such as your bank or a digital payment firm takes a cut every time you make a transfer.

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When you use traditional cash, you’re essentially handing over control to central banks and the government.

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Cryptocurrencies are still in their infancy, and the market for them is pretty volatile.

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