What is a Cryptocurrency?

Cryptocurrencies are digital assets designed to work as mediums of exchange, stores of value, or units of account that use cryptography to secure transactions, control the creation of new units, and verify the transfer of assets without relying on central financial institutions.

Built on blockchain technology, cryptocurrencies operate through distributed networks where transactions are verified by network participants and recorded on public ledgers, creating financial systems that are transparent, borderless, and resistant to censorship or single points of failure.

Unlike traditional currencies issued by governments, many cryptocurrencies have predetermined supply limits or transparent issuance policies governed by code rather than monetary authorities, potentially offering protection against inflation and currency manipulation.

Cryptocurrencies range from payment-focused coins to utility tokens that power specific applications, governance tokens that confer voting rights, and stablecoins pegged to external assets, creating a diverse ecosystem serving different financial and technological needs.

By enabling direct peer-to-peer transfers of value without intermediaries, cryptocurrencies are reducing barriers to financial participation, lowering transaction costs, accelerating settlement times, and creating new economic possibilities for billions of people worldwide.