A cryptocurrency is defined as a digital currency built with cryptographic protocols that make transactions secure and difficult to counterfeit. The most important feature of a cryptocurrency is that it is not controlled by any central authority: the decentralized nature of the blockchain theoretically makes cryptocurrencies immune to old forms of governmental control and interference. Cryptocurrencies make it easier to carry out any transaction, as transfers are simplified through the use of public and private keys for security and privacy purposes. These transfers can be made with minimal processing fees, allowing users to avoid the high rates charged by traditional financial institutions. However, recent news about cryptocurrencies indicates that they are devoid of a central repository; a balance of digital cryptocurrencies can be annihilated by a computer failure, hacking, and other unexpected events.

What are cryptocurrencies?

The most important feature of a cryptocurrency is that it is not controlled by any central authority: the decentralized nature of the blockchain makes cryptocurrencies theoretically immune to old forms of government control and interference. Cryptocurrencies can be sent directly between two parties through the use of private and public keys. These transfers can be made with minimal processing fees, allowing users to avoid the high fees charged by traditional financial institutions. Nowadays, cryptocurrencies have become a global phenomenon known by most people. Few people know, but cryptocurrencies emerged as a byproduct of another invention. Satoshi Nakamoto, the unknown inventor of Bitcoin, the first and still most important cryptocurrency, never intended to invent a currency.