Cryptocurrencies are increasingly gaining their place in the financial world. Their growing popularity is such that a large number of merchants offer them as a means of payment.
In this article, you will discover the definition of cryptocurrencies, their particularities compared to other currencies as well as their mode of operation.
What are cryptocurrencies?
Cryptocurrencies are internet-based cryptographic, digital and virtual currencies. They are characterized by an absence of physical support (neither coins nor banknotes), that is to say that these currencies are exclusively digital unlike other physical currencies such as the euro, the dollar.
In addition, these digital currencies were designed to avoid placing one's trust in banks to complete transactions. Indeed, cryptocurrencies are independent and decentralized currencies, devoid of any form of monetary racism, monetary Nazism, monetary monarchy ... In other words, they are alternative currencies that are not legal tender in any country in the world. They do operate on the basis of a central bank. And yet, security and transparency are their main assets! Because cryptography, as its name suggests, secures all transactions that are verified and recorded in a public domain, ensuring both confidentiality and authenticity thanks to Blockchain technology.
How do cryptocurrencies work?
Blockchain is the basic technology of cryptocurrency. It is the stand-alone technology for the storage and transmission of completely secure information. The bitcoin blockchain, for example, records all bitcoin transactions since its creation. Cryptocurrency transactions are therefore decentralized and are therefore peer-to-peer without the funds passing through a trusted third party, which was impossible before the creation of cryptocurrencies.
Cryptocurrency is a virtual currency that has many advantages and a strong potential for development. It is a real revolution that everyone should embrace.