Cryptocurrency serves as an all inclusive concept for different digital currency systems. Cryptocurrencies rely on strong cryptography to maintain the ownership rights and the security of transactions.
The system is not run by a single party but by a decentralized network of participants coordinated around a common data set.
The backbone of traditional financial infrastructure is extremely central and it is vice versa in cryptocurrency. In the traditional financial system; each bank is strictly regulated and has tı go through many controls before serving a client. However, the bank does not have any control over the money that it holds.
On the contrary, the crypto currency scheme has no difference between banks and clients so each user is his own bank.
Also, there are regulations in cryptocurrency, too but software imposes sanctions rather than mediators.
It is possible for anyone to set up his bank which is called nodes in cryptocurrency terminology by downloading a software and running it on an ordinary computer.
Since there is no central source of information; when a node generates new data or receives information from another node, it delivers that information to all connected nodes immediately. Other nodes repeat the same action so all up to date information spreads rapidly across the network. (In order to have more information about the operation methodology of the nodes, blockchain technology study is required)
All nodes need to handle the registries as well since there is no management in cryptocurrency. When a new transaction series (called a block) is delivered, the software is able to verify whether that block was created due to the system rules, or not. For example; if the block creator tries to spend money which he does not have, the transaction is automatically rejected by the network.
The name “cryptocurrency” stems from cryptography which provides privacy and the safety to the entire cryptocurrency scheme.
User level entry point to cryptocurrency is a private key which is an unpredictable (even by the combined power of powerful computers) enormous number.
Once a user creates the private key (please note that the recovery of the key is impossible), he may derive public addresses and share with other users for cryptomoney transactions.
How to earn crypto money?
Who prints cryptomoney?
Crypto Money is printed automatically according to a predetermined schedule and delivered to who makes decentralised transactions, password calculations and keeps accounting books.