Cryptocurrency is digital money that is not issued or controlled by any government or central bank. Instead, it uses cryptography (complex math and computer code) to secure transactions and control the creation of new units.
The key features of cryptocurrency are:
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Decentralized - Cryptocurrency operates on a distributed public ledger called blockchain that no single entity controls. This makes it very difficult for any government or authority to manipulate.
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Secure - Cryptography is used to verify transactions and secure the network. Advanced encryption techniques ensure funds can only be accessed by the owner.
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Transparent - Most cryptocurrencies have a public ledger that shows all transactions ever made on the network. This provides transparency and traceability.
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Irreversible - Once a transaction is verified and added to the blockchain, it generally cannot be reversed or changed. This permanence prevents fraud.
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Limited supply - Many cryptocurrencies set a finite limit on the total number of coins that can ever be created. This helps maintain value by reducing inflation.
So in simple terms, cryptocurrency utilizes modern technology like blockchain and cryptography to allow digital money to be decentralized, secure, transparent yet private, permanent, and scarce. This gives cryptocurrency unique advantages over traditional government-issued currencies.