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Digital Asset
Cryptocurrency exists in digital form and can represent value within a particular network or ecosystem.
CRYPTO BASICS
What Is Cryptocurrency?
A simple starting point for understanding digital money, blockchain networks, wallets and how cryptocurrency transactions work.
Beginner Guide
Understanding Digital Assets
The Basics
Digital Value Without Traditional Cash
Cryptocurrency is a form of digital asset that can be transferred between participants using blockchain or other distributed ledger technologies.
Unlike physical cash, cryptocurrency exists digitally. Depending on the network and asset, transactions can be recorded on a shared ledger and verified by participants in that network.
Bitcoin is the first widely known cryptocurrency. Since then, many other digital assets and blockchain networks have been created with different designs and purposes.
CORE CONCEPTS
Three Ideas to Understand First
You do not need advanced technical knowledge to begin understanding cryptocurrency. Start with these three fundamentals.
02
Blockchain
Many cryptocurrencies use blockchain technology to record and organize transactions across a distributed network.
03
Wallet
A crypto wallet helps users manage the information needed to interact with their digital assets and blockchain addresses.
HOW IT WORKS
From Transaction to Confirmation
A basic cryptocurrency transaction involves several steps before it becomes part of the network's recorded history.
Create a Transaction
A user initiates a transaction from a wallet or compatible application and specifies the destination and amount.
Network Verification
The transaction is broadcast to the relevant network where participating systems verify it according to that network's rules.
Transaction Recorded
Once accepted by the network, the transaction can become part of the blockchain's recorded transaction history.
KNOW THE TERMS
A Few Crypto Words You Will See Often
Understanding the language makes it easier to follow crypto-related information and ask better questions.
Private Key
Sensitive cryptographic information
used to authorize certain actions.
Public Address
An address that can be shared to
receive compatible digital assets.
Transaction Fee
A network-related cost that may apply
when submitting a transaction.
Blockchain Network
A distributed system that maintains
records according to defined rules.
IMPORTANT TO KNOW
Cryptocurrency Also Involves Risk
Learning how cryptocurrency works is only the first step. Digital assets can involve significant financial, technological and security risks.
Price Volatility
Digital asset prices can change quickly. Market movements may result in significant gains or losses.
Security Risks
Poor wallet security, phishing, scams or compromised credentials can result in loss of access or assets.
Technology Risk
Blockchain networks, applications and smart-contract systems depend on technology that can contain vulnerabilities.
Regulatory Changes
Laws and regulatory treatment of digital assets can vary by jurisdiction and may change over time.
KEEP LEARNING
Build Your Crypto Knowledge Step by Step
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