Let me explain some fundamentals.

Cryptocurrencies have become the "talk of the town" for a variety of reasons, ranging from massive returns to widespread adoption. Despite this, very few people understand the basics of cryptocurrencies. More importantly, what is this one-of-a-kind innovation that is creating such a stir around digital currencies?

If you want to learn and understand this concept, you've come to the right place. My academy focuses on helping readers understand the fundamentals of cryptocurrency and blockchain in order to make sound decisions.

• What are cryptocurrencies?

• Key characteristics of cryptocurrencies

• The major cryptocurrencies

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What are cryptocurrencies?

To put it simply, cryptocurrency is a virtual digital asset that records and stores transactions using a ledger.

Cryptocurrencies are also frequently referred to as "tokens." You're probably wondering why they're called "cryptocurrencies," and here's why. They are protected by 'cryptography' techniques to prevent double-spending, which means that the same token cannot be spent twice.

Another significant feature of digital currencies is that they are built using decentralized blockchain technology.

No central authorities or institutions manage, govern, or operate cryptocurrencies. They are entirely decentralized.

Digital currencies operate on a peer-to-peer network, allowing buyers and sellers to conduct direct transactions without the need for a middleman or centralized institution. The transactions are approved, and the network is collectively managed by the nodes or participants. The Bitcoin blockchain, for example, is managed by nodes or Bitcoin network participants.

Although you cannot hold cryptocurrencies in your hands, they will undoubtedly add value to your bank accounts or digital wallets. Cryptocurrencies, like fiat currencies, can be used as a form of payment to purchase goods and services. They are, however, more than just a form of currency. They are also regarded as investment vehicles, similar to stocks, metals, gold, commodities, and so on.

Cryptocurrency characteristics

• Decentralized - Cryptocurrencies are not controlled by a single entity. A single entity does not have control. Instead, it is distributed among multiple blockchain network participants.

• Peer-to-peer - Transactions can be conducted directly between two users on a peer-to-peer network, eliminating the need for intermediaries.

• Secure - Digital currencies use cryptographic techniques to ensure transaction security.

• Irreversible - Crypto transactions are recorded on a digital ledger called blockchain. Once a transaction is completed, it cannot be reversed or modified.

• Permissionless - Because digital currencies are not centralized, any participant can transact or view transactions on the digital ledger.

• Possible finite supply - The majority of cryptocurrencies have a finite supply. Bitcoin, for example, has a supply of 21 million tokens.

• Transparent - Every transaction stored on the blockchain is transparent and can be viewed by anyone connected to that network.

• Financially inclusive - Crypto networks are global and accessible to anyone with internet access, regardless of location. This makes it easier to connect the unbanked to the financial ecosystem.

The primary components

Although newcomers may be familiar with Bitcoin and Ethereum, the crypto market is vast, encompassing thousands of digital assets. At the same time, it is worth noting that the top ten cryptocurrencies control 90% of the market.

Bitcoin was the first cryptocurrency to be decentralized. It is also one of the first applications of blockchain technology.

Satoshi Nakamoto, a pseudonymous founder, envisioned Bitcoin as a peer-to-peer electronic cash system. Bitcoin remains the most valuable digital currency in a market of 22.000 cryptocurrencies as of December 2022. You may have realized by now that Bitcoin is the lone shark dominating nearly half of the cryptocurrency market.

Altcoins are cryptocurrencies that arose after Bitcoin, the first cryptocurrency.

In my upcoming information, I will go over the fundamentals of Bitcoin and look closely at altcoins. With everything I've said about cryptocurrencies, you should have a better understanding of how they represent a significantly unique innovation.


as always:

before you invest in crypto – invest in yourself