Cryptocurrency is a digital currency with no physical presence that operates outside of traditional banking and government systems. is the name given to a type of currency.

As the name suggests, it uses cryptography (encryption) to secure transactions.

Thus, cryptocurrency is an internet-based medium of exchange that uses cryptographic functions to conduct financial transactions.

Cryptocurrencies are secret because they can be managed without a central bank. They cannot be inflated by central banks looking to hold value and print money. Therefore, it attracts the attention of many people.

It is also very difficult to fake because of the blockchain ledger system that manages the currency.

How does cryptocurrency work ?

Cryptocurrencies are produced, tracked and managed through a structure called a distributed ledger, such as the blockchain.

In a distributed ledger, the movement of currency is processed by computers in a decentralized network to ensure the integrity of financial data and ownership of the cryptocurrency. This structure is called peer-to-peer (p2p).

Each computer has a record of a full history of all transactions and therefore the balance of each account.

For example, when Joe sends 1 unit of cryptocurrency to Jack, it is signed with Joe's private key. is an encrypted file. This transaction is broadcast on the network and sent from one peer to every other peer. The transaction is almost immediately known to the entire network and is confirmed after a certain period of time. Confirmation mechanism is a critical concept in cryptocurrencies.

Cryptocurrency transactions must be fully approved by the entire network. Therefore, it cannot be faked. When you fake it and try to sell it, other computers on the network (miners) check for it in their distributed ledger. If it is not available to everyone, it will not be approved.

This is what miners do. Many people know mining as producing cryptocurrencies. However, mining is the name given to jobs in the cryptocurrency network. Mining is the act of verifying, encrypting and securing transactions in each block.

Each miner has a ledger of all past and current transactions running on the network. This means that every new transaction can be recorded and verified in the ledger. If someone tries to create any counterfeit money or steal money from another person's cryptocurrency wallet, this is checked against millions of copies of the ledger.

Miners are rewarded with crypto money after this verification process. As we just mentioned, mining is not about producing cryptocurrencies. These are the actions taken to keep the system afloat. As a reward, the system gives them cryptocurrencies.