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Defining Crypto: What is Cryptocurrency and How Does it Work?

Cryptocurrency is a digital or virtual asset designed to work as a medium of exchange. It uses cryptography to secure its transactions, to control the creation of new units, and to verify the transfer of assets. Cryptocurrencies are decentralized, meaning they are not subject to government or financial institution control.

Bitcoin, the first and most well-known cryptocurrency, was created in 2009. Cryptocurrencies are often traded on decentralized exchanges and can also be used to purchase goods and services.

Cryptocurrencies are created through a process called mining. Miners use special software to solve math problems and are awarded cryptocurrency as a reward. Cryptocurrency can also be purchased directly from exchanges.

Cryptocurrencies are held in a digital wallet and can be used to pay for goods and services. Bitcoin can be converted to cash when withdrawn from an ATM.

Cryptocurrencies have been subject to volatility and risk. The value of Bitcoin has fluctuated greatly since its creation. In 2013, the value of Bitcoin spiked to over $1,000 before crashing to around $300. In 2017, the value of Bitcoin rose again, reaching a high of over $19,000 before falling back down to around $3,000.

Cryptocurrencies are a risk due to their volatile nature, but they can also be a great investment opportunity. Many people believe that cryptocurrencies are the future of money and that their value will continue to rise.

(This is not financial advice. Please do your own research before investing in any cryptocurrency.)