If you are new in the cryptocurrency market then you have to know about what is cryptocurrency. Cryptocurrency is digital currency which based on a blockchain technology. You are also familiar with Bitcoin, Ethereum, Cardano, BNB etc. So currently there are total 12,700 plus crypto in circulation according to coinmarketcap.
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| Source : Google |
You can also use cryptocurrency for buying goods, shopping, fess payment now as time passes few country start accepting crypto as a payment. It can be risky for new user but if they search what is crypto currency and know how its work then it is similar to another assets. But different is that crypto is completely digital.
How Does Cryptocurrencies Work?
As I said cryptocurrency is digital currency and it work on blockchain technology. For ex. U.S dollar, Indian Rupees INR etc. has central authority that manage and maintain the value of it, but in crypto there is no central authority to manage an maintain the value of cryptocurrency which is the best part of crypto.
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| Source : Google |
Bitcoin was the first cryptocurrency first outlined in principle by Satoshi Nakamoto in 2008 paper titled "Bitcoin a peer to peer electronic cash". So we can say that Satoshi Nakamoto is the person who invented crypto.
That cryptographic proof comes in the form of transactions that are verified and recorded in a form of program called a blockchain.
What Is Blockchain?
Blockchain is system which record the information of transaction in such a wat that it difficult or impossible to change, hack. In simple word it is like checkbook which is distributed across countless computers around the world. Transaction are recorded in a block and then linked together with chain which is previous transaction.
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| Source : Google |
For Example you are writing a book in which you already write upto 14 pages so here your pages means page 1, page 2.... are the "Blocks" and if you combine them continuously with another page then it becomes "Chain". So the your whole book is called as "Blockchain". Similarly Cryptocurrency are work on blockchain.