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What Is Cryptocurrency
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What Is Cryptocurrency

Cryptocurrencies have been some of the most talked-about, new forms of transaction online. They are unique, they are innovative, and they are re-shaping the way people think about money. They have also turned many people into millionaires overnight. Keep reading to find out what cryptocurrencies are exactly.

What Is Cryptocurrency

Simply put, a cryptocurrency is a type of digital currency that is fully secured through the usage of cryptography. As such, this cryptographic algorithm protects it and makes it nearly impossible to fake. 

Many cryptocurrencies are fully decentralized networks based on what is known as blockchain technology.

The blockchain is a distributed ledger that is enforced by a network of computers. This means that cryptocurrencies are not issued by any central authority, so they cannot be manipulated or interfered with by governments.

How Does Cryptocurrency Work

Different cryptocurrencies work in different ways; however, one of the most common ways is the Proof-of-Work (PoW) consensus algorithm. 

This allows nodes, known as miners, to take advantage of their hardware, such as graphics processing units (GPUs), and contribute to validating the transactions on the network. By validating a transaction, they are rewarded with a newly mined coin, and the transaction is confirmed. For Bitcoin, this happens every 10 minutes. The validated block of data is then added to a chain, and this is where it gets its name on the blockchain.

This online ledger has strong cryptography as a result and secures each of the transactions.

Cryptocurrencies are most commonly used to send digital currencies from one wallet address to another, or in other words, for transactional purposes. If you are wondering what a crypto wallet is, it’s a wallet that stores your private and public keys where you can receive crypto and send crypto from.

How Can You Invest in Crypto?

If you want to invest in cryptocurrencies, there are many cryptocurrency exchanges and brokerages that will allow you to do so. But which one should you use?

We have the answer. Our crypto exchange comparison platform will help you pick the right brokerage for your specific needs. All you have to do is answer a few questions (it only takes a couple of minutes, we promise), and our algorithm will then do its magic, instantly showing you which exchange gives you the best chances to succeed as a trader. Try it now!

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