Cryptocurrency

Cryptocurrency is a type of digital or virtual currency that uses cryptography for security. It operates on decentralized technology called blockchain, which is a distributed ledger enforced by a network of computers (or nodes). This decentralization makes cryptocurrencies resistant to government or financial institution control, allowing for peer-to-peer transactions.

Cryptocurrencies can be used for a variety of purposes, including online purchases, investment, and as a means of transferring value across borders. Unlike traditional currencies, they typically do not have a physical form and are not issued by any central authority. The most well-known cryptocurrency is Bitcoin, but there are thousands of other cryptocurrencies, each with various features and purposes, such as Ethereum, Ripple, and Litecoin.

Transactions involving cryptocurrencies are recorded on the blockchain and are pseudonymous, meaning that while the transaction details are publicly accessible, the identities of the parties involved are not easily discernible. This aspect offers both privacy and transparency. Cryptocurrencies also involve unique economic models, often characterized by factors such as scarcity, volatility, and the potential for substantial investment returns.