What is Cryptocurrency?

Hey guys!
Today i'm going to be explaining this crazy boom called cryptocurrency.

What is Cryptocurrency?

I'm glad you asked! Cryptocurrency is a network of different digital currencies that are completely decentralized, here is a chart of what im talking about:

Basically, decentralized is completely spread out, no central connection. Cryptocurrency is also encrypted, which means that it is very hard to crack, not even those million dollar hacks everyone has been talking about. One thing that every cryptocurrency is connected to is called the blockchain.

What is the Blockchain?
The blockchain is the complete history of blocks and transactions, ill get to those in a bit. All of the different cryptocurrencies are connected to the blockchain in some way, or it is not a cryptocurrency. The blockchain is like a tree, the main blockchain is the stump, and the other cryptocurrencies are little branches, or little blockchains, coming out of the main one.

What is a Block?

When a block is created, all of the incoming transactions are dumped into a new or inactive block. A block has a few different things, an answer to an equation, all of the unconfirmed transactions, and an amount of the cryptocurrency the block is connected to, (This wont be the case forever). And the transaction fees from the unconfirmed transactions.

What is a Transaction?

A transaction is the action of one person sending a cryptocurrency to another person, (Think of it like you gave a dollar to you friend, that would be a transaction). But to send that cryptocurrency to someone, you have to get there cryptocurrency address, a bunch of numbers and letters assigned to that persons cryptocurrency wallet, (The same as email, you need there email address to send anything to them). When someone executes a transaction, you also have to pay a small fee which goes to the miners which I will be explaining later.

What is a Cryptocurrency Wallet?

A wallet is what you store your cryptocurrency on, its where all the magic happens.
There are two main types of wallets, there are:

*Online wallets. These wallets are through companies online such as coinbase. They store your cryptocurrency on their website/app.
*Hardware wallets. These wallets are like a USB flashdrive, where you can hold it in your hand. Only you have access to this wallet.

How can I earn Cryptocurrency?

Here are the main 3 ways to earn cryptocurrency:

1. You can buy it. One of the best places to buy the main 3 cryptocurrencies (Bitcoin, Etherium, and Litecoin), is https://coinbase.com . And there are more places to buy it aswell.

2. You can exchange for it, almost the same as buying it, but more like exchanging a crypto for another crypto.

3. You can mine it. Mining cryptocurrency is what I will be explaining next.

What is Mining?

Mining cryptocurrency is where you allow your CPU / GPU of your computer (Or someone elses) to run an application that mines cryptocurrency.
Here is the complicated stuff, people that mine cryptocurrencies are the ones who are providing the security of the cryptocurrency, the way that is happening is your computer is executing and algorithm that is solving mathmatical problems, and are trying to find The answer to the equation of the blocks. It is like a race, whichever person finds the answer first is the person that confirms the transactions first, so hackers cant get in. then the person that found the answer gets the pot of the block, so they get all the transaction fee profits, and the extra cryptocurrency that is created. That is rarely the case if you are mining alone, but if you have a group called a pool, then you can start earning FAST.

What is a Pool?

A pool is when miners come together to form a group, and whenever they solve a block, they all split the profits depending on how much each miner worked.

What is a Hash?

A hash, kilohash, megahash, gigahash, terahash, etc, is the number of how hard your CPU / GPU is working to mine cryptocurrency. The more hashes you have, the more you will earn.

What is cloud mining?

Cloud mining is when you pay someone, or a group, to mine cryptocurrency for you for a specific amount of time, and they give you almost all of the profits that miner makes.

Thats all I can say right now folks! If you have any questions feel free to comment and ill reply to you ASAP!
Come join us on bitconnect at: https://bitconnect.co/?ref=JefferyColon
Wanna start Cloud mining? Go start hashing away at: https://hashflare.io/r/8C42BCA7

Thanks for reading!