What are cryptocurrencies - a guide for beginners

A cryptocurrency is a digital or virtual currency that uses cryptography for security. A cryptocurrency is a difficult asset to counterfeit because of this security feature. Many cryptocurrencies are decentralized systems, based on blockchain technology, a distributed registry imposed by a different network of computers. A defining feature of a cryptocurrency, and probably its most attractive aspect, is its organic nature. Virtual currency is not issued by any central authority, which makes it theoretically immune to government intervention or manipulation.

The first cryptocurrency to surprise the general public and redefine the concept of conventional currency was Bitcoin, launched in 2009 by an individual or group known by the pseudonym Satoshi Nakamoto. In October 2018, more than 17.33 million digital currencies were put into circulation with a total market value of approximately $ 115 billion (although the exchange rate of the cryptocurrency may fluctuate quite a lot and automatically the total value of the capital market). The success of the first digital asset Bitcoin has generated the emergence of other competing currencies, known as "altcoins" such as Ethereum, Litecoin, EOS and Cardano. The list can go on, of course, currently the crypto market totaling thousands of cryptocurrencies, with a total market value of over $ 200 billion (Bitcoin currently represents more than 50% of the total value).

What is their usefulness we ask? First of all, cryptocurrencies have been thought of as systems that allow secure payments of online transactions, which are defined in terms of virtual "tokens", which represent records of internal registers of the system itself. The term "crypto" refers to the fact that different encryption algorithms and cryptographic techniques are used, hence the specific prefix of these virtual currencies.