What does cryptocurrency mean?

Cryptocurrency is a digital currency that utilizes cryptography technology and has the characteristics of decentralization, anonymity, unforgeability, limited supply and global transactions. It operates on the blockchain, a decentralized and immutable ledger that records all transactions, with miners earning rewards by solving hashes and adding them to the blockchain. Common cryptocurrencies include Bitcoin, Ethereum, Litecoin, and Ripple.

Cryptocurrency: Definition and Concepts

Cryptocurrency is a digital or virtual currency that uses cryptography technology to secure transactions Security, control new unit creation, and verify asset transfers.

Features:

• Decentralization: Not controlled by a central bank or government, transaction records are stored in a shared, decentralized ized database.
• Anonymity: Transactions are generally anonymous and not associated with personally identifiable information.
• Unforgeable: Cryptography technology ensures that transaction records cannot be tampered with or forged.
• Limited Supply: Many cryptocurrencies have a limited supply, which can increase their value.
• Global Trading: Cryptocurrencies can be traded freely around the world without geographical restrictions.

Operating Principles:

Cryptocurrency is built on blockchain technology. Blockchain is a decentralized and immutable ledger that records all transactions. Every transaction contains a mathematical puzzle called a hash.

• When a transaction is made, miners compete to solve the hash.
• Miners who successfully solve the hash will be rewarded, called the mining reward.
• The transaction is then added to the blockchain and permanently recorded.

Type:

There are thousands of cryptocurrencies, the main types include:

• Bitcoin (BTC): The first and most famous cryptocurrency.
• Ethereum (ETH): A platform that allows the development of decentralized applications.
• Litecoin (LTC): A lightweight alternative to Bitcoin.
• Ripple (XRP): A cryptocurrency primarily used for cross-border transactions.

The above is the detailed content of What does cryptocurrency mean?. For more information, please follow other related articles on the PHP Chinese website!