Cryptocurrency (crypto) is a digital currency working as a medium of exchange through computer network and can be used for purchases or as an investment. It’s decentralized meaning it’s not regulated by any central authority, but instead managed by a peer-to-peer system.
How Does It Work?
Cryptocurrency runs on a public ledger called Blockchain, which records all transactions carried out. Its units are created through mining, which involves using computer power to solve complicated mathematical problems that generate coins which are then stored in a “wallet”. If you own a crypto investiment, you have a private a key used to prove ownership of funds to the network when making a transaction. Once parachute coins can be used in online transactions wherever they’re accepted.
Examples of Cryptocurrency
Bitcoin- The first and still the most commonly traded. Click here to learn more about Bitcoin.
Worldcoin – The latest type to join the crypto world and fastest growing. Find more about Worldcoin here, and the controversy surrounding it. .
Others are; Ethereum, Ripple and Litecoin among others.
Pros of Cryptocurrency
Apart from cheaper and faster money transfers and transactions being done any time of day or night, there are also no limits on purchases and withdrawals. Moreover, it’s decentralized system does not collapse at any single point of failure.
Cons of Cryptocurrency
It not only faces price volatility but also lacks key policies related to transactions e.g., no refund/cancellation policy. It’s also subject to cyber security breaches.