Cryptocurrency is a form of digital payment that operates without the need for banks to verify transactions. It functions on a peer-to-peer network, allowing users to send and receive payments from anywhere in the world. Unlike traditional money, which exists physically, cryptocurrency only exists digitally, with transactions recorded in an online database. When you make a transfer using cryptocurrency, the transaction details are logged in a public ledger, and the funds are stored in digital wallets.

The term cryptocurrency comes from the fact that it relies on cryptography to secure transactions. This involves the use of advanced coding to protect the transfer of data between wallets and the public ledger. Encryption ensures the security and integrity of these transactions.

Bitcoin, launched in 2008, was the first cryptocurrency and remains the most widely recognized today.