Cryptocurrency Basics.
Cryptocurrencies are virtual or digital currencies that use cryptography to secure financial transactions and operate independently of central banks. These currencies are based on blockchain technology, which ensures transparency and security.
The most important features of digital currencies:
1. Decentralization: It is not controlled by any government agency or institution.
2. Security: Relies on encryption for protection.
3. Speed: Facilitates money transfers in seconds or minutes.
4. Privacy: Does not require direct personal information.
5. Low fees: compared to traditional systems.
Most popular cryptocurrencies:
• Bitcoin: The first and most famous digital currency launched in 2009.
• Ethereum: A currency that enables the development of smart contracts.
• Ripple: Used to facilitate money transfers between banks.
How do cryptocurrencies work?
1. When someone sends a digital currency, this transaction is recorded in the blockchain network.
2. The validity of the process is verified by network participants (miners or Validators).
3. The process is added to a permanent and transparent record.
Discussion question:
What appeals to you most about the idea of cryptocurrencies? Privacy, investment, or technology?
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