What is Cryptocurrency?
A cryptocurrency is a medium of exchange (like normal currencies such as the US Dollar), but designed for the purpose of exchanging digital information through a process made possible by cryptography. Cryptography is used to secure the transactions and to control the creation of new coins (via ICOs -- Initial Public Offerings).
Unlike centralized banking, like the Federal Reserve System, where governments control the value of a currency like the US Dollar through the process of printing fiat money, governments have NO control over cryptocurrencies as they are fully decentralized. A bank has a central server that keeps records about the balances. In a decentralized cryptocurrency network, you don‘t have this server. Every person in the network has a list (ledger) with all the transactions. This digital public ledger that records all transactions is called the blockchain. Data is stored across a network, so it’s not susceptible to exploitation by hackers or central server failures (i.e. banks). Each record or series of records on the blockchain is known as a block. A block is sent to the network and added to the blockchain after it’s accepted by the network as a valid transfer. Once verified, the blocks cannot be changed.
In the simplest of forms, cryptocurrency is digital currency.
The first cryptocurrency created was Bitcoin in 2009. Today there are thousands of cryptocurrencies, often referred to as Altcoins.