CLUB75 || INTRODUCTION TO CRYPTOCURRENCY

CRYPTOCURRENCY

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The word "cryptocurrency" is a compound word and it consists of "CRYPTO" which means hidden or unknown while "CURRENCY" as we all know means money.

So in other words cryptocurrency can be defined as digital money or asset which was created with the sole aim of carrying out our regular financial transactions just like we do with our fiat. As we all know fiat means legal tender (money)like Ghanian cedis, naira, dollars, pounds etc.

Transactions being carried out using cryptocurrency are stored on the ledger called Blockchain

BLOCKCHAIN

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Blockchain is the grand ledger and it uses cryptographic method to save data.
The reason why crypto is in existence today is because the world is moving and advancing. Bitcoin is the first coin crated and it was created by Sathosi Nakamoto, Thanks to Bitcoin we can carry out transactions without leaving our room, without going to the bank, no goverment control.

The blockchain can not be hacked and it is a grand ledger, everything in cryptocurrency is coded.

TYPES OF CRYPTOCURRENCIES

• Altcoins
• Standard coins.

ALTCOIN: This is also known as Alternative coins, these are coins different from Bitcoin and a very good example of this is Ethereum, Fantom, BnB, Avalanche, Polkadot etc.

And there's a difference between an altcoins and tokens, not all assets are tokens.

Tokens: These are assets that are built on other blockchains, they don't have their own blockchain. E.g SAND is a token built under Ethereum blockchain, Happyland is a token under Binance smart chain network, spirit is a token under Fantom Ecosystem etc.

STANDARD COIN: Bitcoin is a standard coin, some people also believe usdt is a standard coin.

We have two types of means to store our cryptocurrency.

MEANS TO STORE OUR CRYPTOCURRENCY

• COLD WALLET: These are wallets not connected to the internet. It is more like hard drive.

• HOT WALLET: These are wallets that needs to be connected to the internet in order to be able to access them. E.g. Binance, Hotbit, metamask, trustwallet etc.

Then, we have what we call Centralised exchange wallets and Decentralised Exchanges wallet which is also known as Non-custodial wallets.

• Centralized exchange wallets: They are called Centralized because to some extends their is a control over buying, selling, withdrawal and the likes. A good example of Cex are Binance, hotbit, Mexglobal, Kucoin etc.

• Decentralised exchange wallet: They're non custodial because you control it, you're in charge of your assets and security, examples are trustwallet, metamask, coin98. Etc.