What Is Cryptocurrency?
Cryptocurrency is a type of digital currency that is used online - similar to currency but without banks or paper money. It operates and records transactions on a blockchain, which is a public ledger of all transactions that anyone can see, but no one can modify.
Unlike regular currency, which is managed by a central bank, crypto uses cryptography (the same tech that keeps your messages private) to ensure secure and transparent transfer of money between people anywhere in the world.
In short:
Cryptocurrency is P2P, a digital-only, decentralized, secure, and borderless currency.
How Does Cryptocurrency Work?
Heres a straightforward breakdown of how cryptocurrency functions:
1. Transactions
Every transaction includes a sender, a receiver, and an amount. To send a transfer, the sender will sign the transfer transaction with their private key (a digital signature), affirming that the funds belong to them.
2. Verification
Rather than financial institutions, a collection of computers (called nodes) validate transactions. Some implementations (like Bitcoin) use Proof of Work, others use Proof of Stake, in the case of other cryptocurrencies (like Ethereum 2.0). The function of these systems is to make fraudulent transactions or double-spending as difficult as possible.
3. Blockchain
Once verified, transactions are grouped into blocks and added to the blockchaina transparent, unchangeable ledger. Each new block strengthens the networks security.
Live Cryptocurrency Prices (As of July 23, 2025)
Heres a quick look at todays top cryptocurrencies and their latest prices:
Cryptocurrency | Price (USD) | 24H Change |
Bitcoin (BTC) | $118,746 | +1.28% |
Ethereum (ETH) | $3,715 | +0.85% |
Binance Coin (BNB) | $798 | +6.40% |
Prices can change minute-by-minute. Always check a reliable source like CoinMarketCap or Crypto.com.
What Are the Types of Cryptocurrency?
There are three major types of cryptocurrencies you should know:
1. Bitcoin (BTC)
The original and most well-known crypto.
Supply is capped at 21 million.
Often called digital gold for its store-of-value use case.
2. Altcoins
Alternatives to Bitcoin. Examples: Ethereum, Litecoin, Solana.
Some offer faster transactions or smart contract features.
Altcoin | Purpose | Price (USD) |
Ethereum (ETH) | Smart contracts, dApps | ~$3,715 |
Binance Coin (BNB) | Trading discounts, BNB Chain | ~$798 |
Cardano (ADA) | Peer-reviewed blockchain, DeFi | ~$0.88 |
Solana (SOL) | High-speed, low-fee dApps | ~$201 |
XRP (Ripple) | Cross-border payments | |
Dogecoin (DOGE) | Meme coin with large community | |
Polkadot (DOT) | Blockchain interoperability |
Altcoins serve various purposesfrom smart contracts to faster payments and ecosystem growth.
Example:
Ethereum isnt just a currencyit powers apps, games, and even NFTs using its smart contract platform.
3. Tokens
These exist on top of blockchains (mostly Ethereum) and carry specific functions:
Token | Platform | Use Case | Price (USD) |
UNI (Uniswap) | Ethereum | Governance for Uniswap Exchange | |
Toncoin (TON) | Telegram | Ecosystem access & payments | |
HBAR (Hedera) | Hedera Hashgraph | Enterprise apps | |
PEPE | Ethereum Meme token | Community memecoin | |
GALA | Ethereum Games | GameFi & NFTs | |
Arbitrum (ARB) | Ethereum Layer 2 | Scalability | |
Optimism (OP) | Ethereum Layer 2 | Scalability |
Tokens are highly specialized. Use cases range from governance (UNI) to meme trading (PEPE) and Layer-2 scalability.
Quick comparison:
Type | Runs On Own Blockchain? | Primary Use |
Bitcoin | Yes | Currency, store of value |
Altcoins | Yes | Faster payments, smart contracts |
Tokens | No | Platform-specific use (DeFi, NFTs) |
What Can You Use Cryptocurrency For?
1. Making Payments
Thousands of online businesses now support payments via Bitcoin and other cryptocurrencies. From apps to airline tickets, crypto is emerging as a legitimate alternative to credit cards and cash.
Example: Apple now offers payment in 10+ cryptocurrencies on the App Store.
2. Investing
Most people think of crypto and think of general huge returns, but large price swings are also associated with crypto. It is fast becoming number one explored by investors expanding their diversification using something beyond gold and stocks
Note: I remember in late 2017 that Bitcoin fell from about $19,000 to about $7,000 so be careful.
3. Global Transfers
Using a typical bank is expensive and slow when you are sending money internationally. With crypto, you can cut expenses and timing.
Example: Where a bank transaction can take about 35 days for cross-border transfer, with crypto, it can take 10 minutes and less than $1.
4. DeFi (Decentralized Finance)
Cryptos power an entirely new financial world where you can lend, borrow, or earn interestwithout banks.
Pros and Cons of Cryptocurrency
Understanding both sides is key before getting started.
Benefits
Inflation resistance: Fixed supply (like Bitcoins 21 million cap) protects value.
Security & privacy: Transactions are pseudonymous and recorded on the blockchain.
Lower fees: Especially for international payments or peer-to-peer transfers.
No middlemen: You control your money directly.
Risks
Volatility: Price swings of 1030% in a day arent uncommon.
Hacks: Exchanges can be vulnerable (e.g., Mt. Gox, Bitfinex breaches).
Lost access = lost funds: Forget your wallets private key, and your crypto is gone.
No refunds: Sent to the wrong address? You cant reverse it.
How to Buy Cryptocurrency in India (or Anywhere)
You dont need to be a tech expert to get started.
Step-by-step:
Choose an exchange (e.g., WazirX, CoinDCX, Binance, Coinbase)
Complete KYC verification
Deposit INR or USD
Buy coins (start with Bitcoin or Ethereum)
Store securely in a crypto wallet
How to Store Cryptocurrency Safely
There are two main options:
Storage Type | Description | Best For |
Hot Wallet | Online, easy to access | Daily use & small amounts |
Cold Wallet | Offline (hardware or paper) | Long-term storage & high-value crypto |
Tip: Use a cold wallet (like Ledger or Trezor) for security, and keep your seed phrase safepreferably offline.
FAQs About Cryptocurrency
Is crypto legal in India?
Crypto trading is allowed, but not regulated. The government is still working on a full legal framework.
Is it too late to invest?
Not necessarily. While Bitcoin has grown massively, new coins and projects are still emerging. Always do your own research (DYOR).
How much should I invest?
Start small. Only use money youre comfortable losingcrypto markets are volatile.
Can I lose my crypto?
Yesif you lose access to your wallets private key or fall victim to a scam. Stay vigilant.
Quick Takeaways
Cryptocurrency is digital money built on blockchain techsecure, borderless, and peer-to-peer.
You can use it to pay, invest, send money abroad, or access decentralized apps (DeFi).
Top coins today: Bitcoin ($118,746), Ethereum ($3,715), Binance Coin ($798).
Biggest risks: volatility, lack of regulation, hacks, and no transaction reversal.
Always use trusted wallets, enable 2FA, and start with a small investment.
Final Word
Cryptocurrency is more than hype: it is a new kind of financial instrument that is changing our perspectives on money. If you're interested, start by learning and cautiously trying it out. The biggest things to keep in mind: stay informed, stay secure, and never invest blindly.
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