Cryptocurrency is one of the types of electronic means of payment. In fact, it is a mathematical code. Why "crypto"? Yes, yes, there is definitely a connection with cryptography (encryption). For ordinary money transfers, special codes are used that encrypt the transfer. Only the usual currency is launched into the network, and the cryptocurrency appears already in electronic form.
The currency is measured in coins (coins). But these are not physical coins or bills that you can rustle in your pocket. They are stored only in the form of a code.
The unit of measurement in this system is considered to be "coins" (literally, "coins"). Cryptocurrency has no real expression like metal coins or paper banknotes. This money exists exclusively in digital form.
How does this money appear?
Mining-(production of new units due to equipment calculations)
ICO (initial coin placement). Developers issue a certain number of currency units with a certain price and put it up for sale for real money.
Forging is the formation of new blockchain blocks.
If the Central Bank issues and controls the currency we are used to, then anyone can issue cryptocurrency. And banks are not needed for cryptocurrency transactions.
You can pay with cryptocurrency by bank transfer, as well as with ordinary money.
However, if you still want to get them in the form of a regular currency, then you will need a special exchange.
Where is the cryptocurrency stored?
The cryptocurrency circulation system is blockchain. This is a shared database that runs on millions of computers all over the world at once. This makes the system transparent, that is, everyone sees the movement of currency in the system and who has how much (the names are naturally not real).
It's like a transparent box with money. You can safely observe who put money there and how much. However, to take your money from there, you need access to your share in the form of a special key that only you have. This is to put it in simple words.
Why is cryptocurrency so popular
The answer is simple. People need versatility and do not need restrictions associated with linking to a country or bank. Cryptocurrency meets these requirements.
Also, the digital currency is protected by cryptography and you worry less for such money — the protection is really very powerful. Such coins cannot be forged or banned. For operations with cryptocurrency, only its number is needed and there is no need to issue its physical media.
An important detail is anonymity. When making transactions, data about the recipient or payer is unknown. You only need the wallet number. In our age, anonymity is a luxury, which is why cryptocurrency is so popular.
Plus, you can get cryptocurrency out of nothing yourself. If you print real money, it will not turn out the best way for you. In the case of digital money, on the contrary, you can earn good money and exchange it for ordinary money. Such an income from the air is very attractive.