Cryptocurrency is digital money that uses a process called cryptography, which is the study of encrypting information in order to send it securely. The process is secure and has measures in place to prevent counterfeiting. It is not controlled by a particular country or even by a particular bank and it's value is determined by the supply and demand of the market so its value is determined much like silver, gold and other precious metals which means the exchange rate may fluctuate.
Cryptocurrencies can be earned by mining which is the use of a piece of software that can solve sophisticated and complex algorithms in order to release blocks of coins into circulation. Everyone competes equally for the coins but the effectiveness depends on the equipment you use and the more coins you mine from a cryptocurrency the harder it becomes to release blocks of coins. There are a limited number of coins that can be mined and once this happens no more can be created.
Cryptocurrencies are secure, anonymous and stable virtual currencies, which are also traceable. Algorithms and mathematical equations are used to keep the system running by linking each account with the amount of the virtual currency they hold. Cryptocurrencies could possibly change the world of finance, as we know it.Origins
B-Money was the first type of electronic cash system described by Wei Dai in 1998. Not long after this Bit-Gold was created by Nick Szabo. Bitcoin however, was the first decentralized cryptocurrency, which was created in 2009 by Satoshi Nakamoto, and then Litecoin was released in 2011.Specifics
There are a number of cryptocurrencies available, which can be used for peer-to-peer transactions to enable you to send money easily and securely online so you have a variety to choose from. Do some research and find out what you need to do to use the currency of your choice before you sign up for a cryptocurrency wallet.
Revised September 22nd, 2015
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