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What is cryptocurrency: understanding cryptocurrency for dummies

A cryptocurrency or crypto is a digital asset, digital payment system, or digital coin. It allows for the most secure payment system which is named as far as virtual "tokens," which are represented by record entries interior to the system.

The basic of cryptocurrency

It is an encrypted system that works as the Peer-to-Peer model. It has no rules of use and there is no central organization or government agencies to control.

You know money or currencies are reserved by the banks and you need a connection to a bank or an ATM to withdraw or transfer. On the other hand, with crypto, you don’t need any of these!

Also, there Is no chance to duplicate cryptocurrency like government-based currency.

What is cryptocurrency: understanding cryptocurrency for dummies

Types of cryptocurrency

Bitcoin was the first cryptocurrency that was founded in 2008 by Satoshi Nakamoto and began use in 2009.

Presently around 7,000 cryptocurrencies are traded publicly with different conditions. But, the first invented cryptocurrency (Bitcoin) is still remaining popular and continuously growing.

According to the CoinMarketCap, the value of cryptos was $645.7 billion in Dec. of 2020. And the value of the only bitcoin was more than $421.7 billion.

Top 10 Cryptocurrency by Market Cap

Cryptocurrency

Market Cap

Bitcoin

$421.7 billion

Ethereum

$73.2 billion

XRP

$25.9 billion

Tether

$20.1 billion

Litecoin

$7 billion

Bitcoin Cash

$5.7 billion

Chainlink

$5.3 billion

Cardano

$5.1 billion

Polkadot

$4.8 billion

Binance Coin

$4.4 billion

 

Are cryptocurrencies legal or illegal?

There is no direct answer in a word that is yes or no. It depends on each individual country. Cryptocurrencies are completely legal in the United States of America and china banned for use.

Cryptocurrency for newbies

Back in 1990, peoples were excited about the internet! Most of the peoples were asked, “What is the internet?”. But not thirty, ten years later this question “What is cryptocurrency?” will no longer need to be asked.

Are cryptocurrencies good or bad for you?

The good thing is it's transparent, you don’t need to trust others. You are the main controller! It is open for everyone while government or banks can ban or block your account.

Cryptocurrency is a safe (encrypted) and very fast system, while banks need 1-5 days to complete a transaction.

The bad thing is it can be erased from the storage and peoples can use it for the crime.

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