Cryptocurrency is a digital money that uses cryptography to secure the processes involved in conducting transactions, generating units, and verifying digital money ownership. Unlike traditional currency, cryptocurrency is not issued and control by any governmental authority through central reserve banks. Cryptocurrencies are designed to be free from government manipulation and control. It is not directly managed and controlled by any other single entity either. It rather works in a distributed consensus based mechanism through systems distributed all over the world.
The word cryptocurrency gains its name by merging “cryptography” and “currency” concepts and cryptographic encryption algorithms are the engines of cryptocurrency. And it is generated by solving pieces of cryptographic hashing algorithms in a long chain of mathematical computations. And cryptocurrency assets are managed and stored in a digital wallet. Besides, all cryptocurrency based transactions around the world are monitored through decentralized and distributed ledger likewise blockchain. The blockchain is a digital system that keeps track of cryptographic hash blocks through mathematical schemes and it is considered the building block technology of cryptocurrency.
The most common types of cryptocurrency in the following:
- Bitcoin: Bitcoin is the most common and popular type of cryptocurrency. And it is a platform that enables online and offline transactions without the involvement of traditional cash. Any transaction for which a credit card, PayPal or debit card is used could be a bitcoin transaction and it accomplishes this while still being decentralized system. Bitcoin continues to lead the pack of cryptocurrencies in the industry in terms of market capitalization, user base, and popularity among other things
Some other popular types of cryptocurrencies are listed below:
- Stellar
- Litecoin
- Monero
- Dogecoin
- Solana
- Cardano
- Binance
- Binance Coin
- USD Coin
- Tether
- Ethereum
- So much more