What is Cryptocurrency?


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Before understanding Cryptocurrency, you first need to understand what blockchain is and how it works. Blockchain is a technology that supports almost all cryptocurrencies. It is a public ledger of every transaction that has been carried out in a cryptocurrency.

These transactions are assembled into what are called “blocks''. These are verified to ensure they are legitimate by cryptocurrency miners. Then the next sequential transaction block is connected to it. This is how cryptocurrencies are created and how new cryptocoins are made.

Cryptocurrency mining, or cryptomining, is a process in which transactions for various forms of cryptocurrency are verified and added to the blockchain digital ledger.

Each time a cryptocurrency transaction is made, a cryptocurrency miner is responsible for ensuring the authenticity of information and updating the blockchain with the transaction. The mining process itself involves competing with other cryptominers to solve complicated mathematical problems with cryptographic hash functions that are associated with a block containing the transaction data.

The first cryptocurrency miner to crack the code is rewarded by being able to authorize the transaction, and in return for the service provided, cryptominers earn small amounts of cryptocurrency of their own. In order to be competitive with other cryptominers, though, a cryptocurrency miner needs a computer with specialized hardware.