Cryptocurrencies are digital assets based on blockchain technology. Blockchain technology maintains a record of every bitcoin transaction on every node that powers the network. A node is a machine that mines bitcoins by connecting to the Bitcoin network. A fake transaction entered by one of these miners would be nullified by the correct ledger.

The process of cryptocurrency involves decentralised digital transactions secured by blockchain technology. When a user initiates a transaction, it is broadcast to a peer-to-peer network of computers (nodes) for validation. Miners or validators then verify the transaction using consensus mechanisms like Proof of Work (PoW) or Proof of Stake (PoS). Once confirmed, the transaction is grouped into a block and added to the blockchain, a permanent, tamper-proof ledger. Cryptocurrencies like Bitcoin and Ethereum rely on cryptographic techniques to ensure security and prevent double-spending. Users store their assets in digital wallets with private keys for access. Transactions are pseudonymous, recorded on the blockchain without revealing personal identities. This decentralised system eliminates the need for intermediaries like banks, enabling fast, global, and low-cost transfers while maintaining transparency and trust through cryptographic verification.