Crypto Scholar was created to provide a fun & easy learning experience about cryptocurrencies, blockchain and everything in between. We know it can be a little intimidating when you’re new and don’t understand the terminology. This guide is here to gradually introduce you to the key concepts you need to kick-start your journey into the world of crypto and blockchain technoloy.
Before we dive into what a cryptocurrency is you need to understand the underlying technology called blockchain, which enables the existence of cryptocurrencies. A blockchain is a decentralized ledger secured by cryptography that contains all the transaction records across a peer-to-peer network. By utilizing the technology people can secure transaction records, control the creation of additional coins, and verify the transfer of coin ownership all without a need for a central clearing authority like a Chase Bank or PayPal. The potential applications for blockchain can include fund transfers, settling trades, voting, supply chain monitoring and many other applications.
So what is a cryptocurrency? A cryptocurrency is a digital asset that is created and stored electronically on a blockchain that functions as a medium of exchange. It can be used to pay friends, buy products, secure a blockchain network, yield farm, stake and more. Because cryptocurrency is digital, it can also be sent to friends and family anywhere in the world.
Just like PayPal or bank transfers, right?
Well, not really. It’s way more interesting!
You see, traditional online payment gateways are owned by organizations. They hold your money for you, and you need to ask them to transfer it on your behalf when you want to spend it.
In cryptocurrencies, there isn’t an organization. You, your friends, and thousands of others can act as your own banks by running free software. Your computer connects with other people’s computers, meaning you communicate directly – no middlemen required!
To use cryptocurrency, you don’t need to sign up for a website with an email address and password. You can download a wide variety of apps onto your smartphone to begin sending and receiving within minutes.