What is Cryptocurrency?

Introduction In the last decade people have been using more cards and less cash and its safe to say that today people are comfortable with cashfree payments and online payments. However we have always been restricted to use traditional currencies issued by the government. With the introduction of Cryptocurrency, we have entered a new world where currency have also become a choice.

The internet has revolutionized everything across the world whether it is social media, news industry, advertising, traveling, shopping etc. The internet is now adopting cryptocurrencies. The internet has changed the way we communicate and cryptocurrencies will change the way we exchange goods and services as they offer an alternative to the traditional financial system. Lets take a closer look at this alternative.

 Picture Below - The traditional non-cash payments are made through a bank or financial institution. These organisations provide a service as a central, trusted authority that guarantees the transaction in exchange for a fee.

 Picture Below - Cryptocurrencies are a digital representation of value that is issued neither by a central bank or a public authority, but is accepted by natural or legal persons as a means of payment and can be transferred, stored or traded electronically. Cryptocurrencies can be moved, transferred and exchanged without any particular information, leaving few trails in the economy. Regardless of the amount, the transfer happens within short and almost without any fees at all.

 By Definition
The term crypto refers to as “secret, hidden or concealed”. Therefore, crypto-currency can be called a ‘secret currency’. Cryptocurrency is a medium of exchange just like $, €, £, and ¥ etc. and is based on secure transactions on the principles on cryptography. What makes it different than traditional currency is that cryptocurrencies are designed on the purpose of cryptography for person-to-person transaction without having involvement of a third party, government or company. It is open-source for all. Cryptocurrency is a digital representation of value not issued by a central bank or a public authority, nor necessarily pegged to a fiat currency. It has no legal tender status and it can be convertible, one of its most significant features is non-redeemability. A common way to view cryptocurrency is to say it a coin or internet money. A more correct way to look at it is to say its a medium of exchange and exchange system in one.