Cryptocurrency is like digital money that you can use to buy things online. It’s called “crypto” because it uses special codes to keep your money safe.
There are lots of different types of cryptocurrency, like Bitcoin or Ethereum. People use special computers to keep track of it all and make sure everything is working properly. You can buy cryptocurrency with regular money, or you can “mine” it by using your computer to solve special math problems.
Cryptocurrency is a special kind of money that we use on the computer. It’s like the money we use in the real world, but it’s all digital. You can’t hold it in your hand like a dollar bill or a quarter, but you can use it to buy things online just like you would with regular money.
Wallets
Cryptocurrency works a little bit differently than the money we use every day. Instead of having a bank hold onto our money for us, we can use special programs called ‘wallets’ to keep track of our cryptocurrency. And instead of using cash or a credit card to pay for things, we can just send the cryptocurrency from our wallet to the person we’re buying something from.
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Blockchain
Blockchain is a way that we can keep track of things online without using a bank or a company to do it for us. It’s like a special kind of list that everyone can see and add to, but no one can change or delete anything on it.
So, if you wanted to use cryptocurrency to buy something online, the blockchain would keep track of the transaction. It would show that you gave the money to the seller and that the seller gave you the item. That way, everyone can see that what you bought really belongs to you now and the seller can’t take it back or say you didn’t pay.
There are several ways to make money in crypto, such as:
Buying and holding: Some people buy cryptocurrency with the hope that it will increase in value over time. They hold onto their cryptocurrency and sell it when the price goes up, similar to how one might invest in stocks or real estate.
Trading: Others engage in cryptocurrency trading, buying and selling different cryptocurrencies in an effort to make a profit from price movements. This can be done through online exchanges or through more traditional financial markets.
Mining: People can also earn cryptocurrency by “mining” it. This involves using powerful computers to solve complex mathematical problems, which helps to verify transactions on the blockchain and earn rewards in the form of cryptocurrency.
Accepting it as payment: Some businesses choose to accept cryptocurrency as payment for goods or services. This can be a way for individuals or businesses to earn cryptocurrency directly.
Earning it through interest: Some cryptocurrency platforms offer interest-bearing accounts that allow users to earn cryptocurrency by holding onto their coins and earning a return on their investment.
It’s worth noting that all of these activities carry some level of risk, and the value of cryptocurrency can fluctuate significantly over time. As with any investment or business venture, it’s important to thoroughly research and carefully consider the potential risks and rewards before getting involved in the world of cryptocurrency.
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Conclusion
Cryptocurrency is a digital or virtual currency that uses cryptography and decentralized technology to secure and verify financial transactions. Blockchain is a digital record-keeping system that allows multiple parties to reach consensus on a single version of a shared digital history, and is used as the foundation for many cryptocurrencies.
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