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How cryptocurrency works

How do you like the idea of using a currency that is not regulated by any authorities? Sounds cool right! Well, that is exactly what Cryptocurrency is.

It is digital money or digital medium of exchange that is not controlled or regulated by the government or any other institution. Now you may want to understand how these cryptocurrencies work, and this article is going to help you understand how they work.

How they work

Now there are different forms of cryptocurrencies like bitcoins which you can also use as a payment method online as we’ve seen with many successful forex traders in south africa. But even though they are many they are all supported by a dispersed network called blockchain. This system makes sure that all cryptocurrencies are kept track of. This system allows everything to be transparent.

The interesting part is that this decentralized blockchain system operates in a way that makes it immune to how the government controls its money. Because of this cryptocurrency can be sent between two people directly with a very small marginal fee, unlike the ones charged by the old way of sending and receiving money.

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How you send and receive money

There are private and public keys that you can use when you want to send these cryptocurrencies. The public key, in this case, is your address. This is because it gives people access to send tokens to you so that key is their access to your wallet.

Private Key, unlike the public key which can be your email or username, is the password. You need this key to send tokens from your wallet to another. In simple terms since the public key is the email, the private key is the password that allows you to get access to the contents in that email.

Benefits of using cryptocurrency

  • Unlike online forex trading, they are one to one transactions, no need for fees or commission
  • They are more confidential you send the information you wish to send and nothing more
  • No transaction fees they take care of themselves
  • Access to credit because cryptocurrency is available to anyone with the internet.
  • You can make international trading without having to worry about exchange rates imposed by any country.
  • You are the owner of your wallet no one can close or have control of your tokens like a bank.
  • Strong security no need to worry about fraud or account hacking because they have strong encryptions.

 

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