What is Cryptocurrency?

A cryptocurrency is a virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend. Virtual currency is a digital currency that is unregulated and is available only in electronic form.

Many cryptocurrencies are decentralized networks based on blockchain technology—a distributed ledger enforced by a disparate network of computers. A definite aspect of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation.

A cryptocurrency will use cryptography technology to keep digital transactions secure and authentic, while at the same time helping to manage and control the creation of new currency.

Cryptocurrencies uses systems that allow for secure payments online which are denominated in terms of virtual tokens, which are represented by ledger entries internal to the system. Crypto refers to the various encryption algorithms and cryptographic techniques that safeguard these entries, such as elliptical curve encryption, public-private key pairs, and hashing functions.

Tokens are cryptocurrency denominations. Crypto tokens are tradable assets and units that reside on blockchain. Tokens can be used for investment purposes, to store value, or to make purchases, crypto tokens, which are also called crypto assets, represent a certain unit of value. 

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The first blockchain-based cryptocurrency was Bitcoin, which still remains the most popular and most valuable. Today, there are thousands of alternate cryptocurrencies, which are also called Altcoins, and the have various functions and specifications. Some of these are just clones of Bitcoin, while others are new currencies that were built from scratch.

Bitcoin was launched in 2009 by an individual or group, who is known by the pseudonym Satoshi Nakamoto. As of March 2021, there were over 18.6 million bitcoins in circulation with a total market cap of around $927 billion. Several individuals have claimed to be Satoshi Nakamoto but true identity has never been proven. 

There is no physical bitcoin, only balances kept on a public ledger that everyone has transparent access to. All bitcoin transactions are verified by a massive amount of computing power. Bitcoin is not issued or backed by any banks, governments, or any centralized authority. Bitcoin is operated under decentralized authority.

 The bitcoin system is a collection of computers that all run bitcoin’s code and store its blockchain. A blockchain could be thought of as a collection of blocks. In each block there is a collection of transactions. Because all the computers running the blockchain have the same list of blocks and transactions, and can transparently see these new blocks being filled with new bitcoin transactions, no one can cheat the system.

Altcoins all cryptocurrency other than Bitcoin. There are over 6000 altcoins and they account for over 40% of the cryptocurrency market. Some of the different types of altcoins include mine-based cryptocurrency, security tokens, utility tokens, and stablecoins. 

The top ten altcoins are:​​

  1. Ethereum
  2. Litecoin
  3. Cardano (ADA)
  4. Polkadot (DOT)
  5. Bitcoin Cash (BCH)
  6. Stellar (XLM(
  7. Chainlink
  8. Binance Coin (BNB)
  9. Tether (USDT)
  10. Monero (XMR)

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