What is cryptocurrency and how does it work?

Cryptocurrency is decentralized digital money that’s based on blockchain technology. You may be familiar with the most popular versions, Bitcoin and Ethereum, but there are more than 9,000 different cryptocurrencies in circulation. How Does Cryptocurrency Work? A cryptocurrency is a digital, encrypted, and decentralized medium of exchange.

Are cryptocurrencies governed by a central bank?

Cryptocurrencies (or “crypto” for short) are decentralized currencies, meaning they’re neither issued nor governed by a central bank. Some cryptocurrencies are issued by their developers, while others are generated by their respective network algorithms. Crypto are digital assets —they have no tangible form.

What cryptocurrencies are available on NerdWallet?

NerdWallet has created guides to some widely circulated cryptocurrencies, including Bitcoin and some altcoins, or Bitcoin alternatives: Bitcoin is the first and most valuable cryptocurrency. Ethereum is commonly used to carry out financial transactions more complex than those supported by Bitcoin.

What was the first cryptocurrency?

The first cryptocurrency was Bitcoin, created by an anonymous computer programmer or group of programmers known as Satoshi Nakamoto in 2009. Satoshi Nakamoto was concerned that traditional currencies were too reliant on the trustworthiness of banks or governments to work properly.