There are no trusted third parties in cryptocurrency! Note: They are called trusted third parties because users have to trust them with their personal information in order to use their services. Banks, PayPal and Facebook are all trusted third parties. Users don’t deal with each other through banks, PayPal or Facebook. Peer-to-Peer: Cryptocurrencies are passed from person to person online.Networks without a central server are called decentralized networks. They are distributed across a network of (typically) thousands of computers. Decentralized: Cryptocurrencies don’t have a central computer or server.There are no reserves for crypto in Fort Knox or the Bank of England! Digital: Cryptocurrency only exists on computers.Miners try to solve mathematical puzzles first to place the next block on the blockchain and claim a reward.Īn exchange is a business (usually a website) where you can buy, sell or trade cryptocurrencies.Ĭryptocurrency wallets are software programs that store public and private keys and enable users to send and receive digital currency and monitor their balance.īelow is a list of six things that every cryptocurrency must be in order for it to be called a cryptocurrency
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