What is Cryptocurrency?

• A digital asset designed to work as a medium of exchange that uses

cryptography to secure its transactions, to control the creation of
additional units, and to verify the transfer of funds.
• Operates independent of any central authority or individual i.e.
Decentralized
• Supply of money is regulated by software and agreement of users of
the system
• Trust based on peer-to-peer consensus
• Transactions are irreversible
Currency to Cryptocurrency
Conventional Currency Cryptocurrency

• System of Money • System of Digital Money

• Controlled by Governing Body • Controlled by Complex Maths
• The US Dollar • Obtained by:
Old: Gold Standard
Mining
 Each $ corresponded to a certain
amount of Gold (Finite) Receipt of payment
 Ex: $1 = 1.5 gm of Gold Purchase
 1971: Nixon cancels Dollar-Gold
convertibility • Finite amount
Now: Fiat Money
 Dollar’s value not fixed to any
• No intrinsic value
physical unit (Infinite, potentially)
 Value decided by Federal Reserve
• Fluctuating purchasing power
through Monetary policy • No physical form
Differences
Basis Conventional Currency Cryptocurrency
Type Real Virtual

No
Intermediaries Yes
(Peer-to-Peer)
Yes
Portable Highly Portable
(Except Heavy cash)

Durable Moderately durable Highly durable

Global
Acceptance National
(throughout the Internet)
Secure
Moderate High
(Can not be counterfeited)
Sovereign
Yes No
(Government Issued)
No Yes
Decentralized
(Central Bank control) (Controlled by complex Maths)