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Cryptocurrency is a digital payment mechanism that does not rely on banks for transaction verification. It's a peer-to-peer system that allows anybody to make and receive money from anywhere.

 

The name "cryptocurrency" comes from the fact that it employs encryption to authenticate transactions. This implies that storing and sending bitcoin data between wallets and to public ledgers requires complex code. Encryption's goal is to ensure security and safety. As you learned, Cryptography is the practice and study of techniques for secure communication in the presence of adversarial behavior.

 

Cryptography + Currency = Cryptocurrencies.

 

Cryptocurrency markets are decentralised, which means they are not issued or backed by a central authority such as a government. Instead, they run across a network of computers. However, cryptocurrencies can be bought and sold via exchanges and stored in ‘wallets’.Let's move on to the next segment to understand how does someone invest in cryptocurrency, and what are the inherent risks associated with it. 

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