What is the meaning of cryptocurrency?

What is the meaning of cryptocurrency? Cryptocurrencies are a relatively new phenomenon that is transforming and revolutionizing sending and receiving cash. A cryptocurrency is a currency in the digital form generated from a code that runs in a blockchain network. Notably, no central authority, like in the fiat currencies, controls cryptocurrency as it is based on a decentralized system.

You cannot understand the meaning of cryptocurrency without knowing about the pioneer, Bitcoin. Bitcoin is the pioneering cryptocurrency established in 2009 by Japanese national Satoshi Nakamoto, who is still unknown to date. Most importantly, bitcoins are created through a process often referred to as bitcoin mining. When you send bitcoin, the information is received by a computer that confirms and validates the transaction and forms a block that one will mine to get local bitcoins. Nakamoto was the first individual to mine bitcoin.

  • Bitcoin is the pioneering cryptocurrency and was established in 2009

  • Bitcoin price is highly unpredictable

  • Satoshi Nakamoto was the first to mine bitcoin

  • No one owns the bitcoin blockchain

  • The amount of bitcoin available for mining is 21 million

  • Transactions usually follow a three-way book-entry system

  • Anyone can download the open source bitcoin code by anyone

  • Mining of bitcoin is easy provided one has a computer

  • Transactions are recorded and validated in bitcoin blockchains

  • You can earn bitcoin through direct purchases, mining or from payments

Interested in knowing what is the meaning of cryptocurrency, check Buy Bitcoin, What does cryptocurrency mean or What is Crypto?

How The Monetary System Works

A money system is a centralized form of currency where a government or the central bank regulates currency circulation and use. A central authority determines the value of the fiat currency, and when sending money, one needs a third-party intermediary to confirm and complete the transaction. One of the drawbacks of the monetary system is the number of times to confirm purchases, typically 3 to 7 days.

Cryptocurrency Operations

Cryptocurrencies have transformed cross border money transactions because sending of money is fast, and it typically takes 1 minute to an hour to finalize deals. It is easier to trace and track cryptocurrency transactions since all transactions are recorded in a public ledger. This system is a peer-to-peer system that entails sending money between users without involving third parties. The unique aspect of Bitcoin is that the virtual currency has a limit of 21 million available bitcoins. Unlike the fiat system, where more money can be printed no more bitcoins can be issued.

3 Best Cryptocurrency Exchanges


  • Affordable trading fees 0.1%-0.2%

  • Users from 190 countries can access the exchange

  • Traders using native BNB token get 25% off trading fees


  • Charge 0.1%-0.4% trading fees

  • Accessible to users from 130 countries

  • AUsers can buy cryptocurrency using debit/credit card and SEPA


  • Trading fees between 0.1% and 0.4%

  • Available to users in 190 countries

  • SEPA, credit and debit card purchase of cryptocurrency allowed


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Binance is among the most reliable and largest cryptocurrency exchanges globally that support a wide variety of cryptocurrencies. It was established in China three years ago by ex-OKCoin CTO Changpeng Zhao before relocating headquarters to Japan after a ban on crypto exchanges in China. By 2018 the exchange had established itself at the biggest exchange with a market cap of around $1.3 billion.

Over 190 different cryptocurrencies are supported by Binance, including litecoin, Ethereum, and bitcoin, among others, and the native token BNB. Besides being a cryptocurrency trading platform, the exchange also provides its users with crypto wallets to store their cash securely and safely. Binance processes 10-12 billion trades daily and boasts close to 12 million active users per day. The BNB token currently trades around $15 having surged over 16000% from its ICO price of $0.15.

  • Affordable trading fees - 0.1% to 0.2%


  • BNB users get 25% off trading fees

  • Several cryptocurrencies supported around 180

  • Binance holds 320,000 users’ bitcoin

  • Staking rewards available for 23 cryptos

  • Neo Holders get rewards

  • Credit and debit card purchase of cryptocurrency permitted

  • SAFU Funds protecting users’ cash against hacking

  • Relatively with short success record

  • Hackers stole $40 million of cryptocurrency from the exchange

  • Long and complicated KYC for fiat transactions


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Huobi Global has been around for over seven years and was founded by former Oracle computer engineer, Leon Li in China. The exchange raised $10 million in 2014 from a venture investment led by Sequoia Capital and other venture investors. Following the crackdown on cryptocurrency exchanges in China, Huobi moved its headquarters to Singapore. It has grown its operations significantly to around 12 countries, including the US and Japan, among others where it has partner companies and subsidiaries.

It is among the listed cryptocurrency exchanges and is listed on the HKSE after a reverse takeover acquiring 74% interest in Pantronics Holdings. There are currently over 5 million users on the exchange, with around 2-5 billion trades processed daily.

  • Supports 190 cryptocurrencies


  • High liquidity and exceptional prices

  • Multilingual access to customer support

  • High volatility live to trade

  • Supports margin trading and margin funding

  • Derivatives trading available for Futures and Swap markets

  • User protection Fund which acts as surety for users’ funds

  • Accessible from iOS and Android devices

  • Wire transfer purchases not supported

  • Charge 8% fee on credit and debit card deposits

  • Withdrawal capped at $2,000 daily and $10,000 per month


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Kraken is also among the cryptocurrency exchanges that have been around for close to seven years. Its development began in 2011, and the exchange launched in 2013. Kraken received a Series A capital investment of $5 million in 2014 from hummingbird ventures and other venture investors. It was the first exchange to list on the Bloomberg Terminal. The exchange initially supported trading of litecoin, bitcoin, and euro before other cryptocurrencies were integrated later. Currently, Kraken has 2.2 million users from over 180 countries.

  • High liquidity and buy limits 


  • 34 different types of cryptocurrencies supported

  • Daily trading volume 100-200 million

  • Offers over 30 trading pairs

  • Withdrawal charges depend on the kind of cryptocurrency

  • Processing of withdrawals takes 3-5 days

  • Staking rewards

  • No withdrawal limits

  • Limited payment options

  • Doesn’t support INR for trade

  • Slow  customer support

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Drawbacks of Cryptocurrency

Sudden Price Changes

If you want to understand the meaning of cryptocurrency, you should fight to be aware of the highly volatile prices of cryptocurrencies. Prices of cryptocurrencies can change suddenly either by increasing or dropping. For traders, an increase in price is a good thing as that means more profits, but sudden price declines can leave investors counting losses. Bitcoin price, for instance, is highly volatile, and at one time, it dropped $1000 in hours. The volatility of cryptocurrency prices is because their value depends on market sentiment and activity.

The Proliferation Of Cryptocurrency Scams

There are several opportunists out there that are unsuspecting target investors and scam them through fake crypto promotions. Also, hackers target crypto exchanges and wallets to steal cryptocurrency. Over the past, around $70 million in cryptocurrency has been stolen from users and different exchanges.  If users are not careful with their passwords and access keys, hackers can easily use them to steal their funds. Always use an offline device to store the authentication keys, passwords, and access keys.

Exaggerated Trading Fees

Some cryptocurrency providers can be conniving in that they indicate that they offer low trading fees, but there are other hidden fees levied on users making fees to be very high. This manipulative behavior can disadvantage investors and traders when buying and trading crypto. It is vital to research sites like BuyBitcoin24.com, which compares different exchanges to offer the best recommendation of trustworthy exchanges.


The website is only for the educational purposes. The website does not constitute the provision of any financial or investment advice in connection with the use of the website. You should consult with a financial or investment professional to understand the risks of cryptocurrencies. You should not invest more than you are ready to lose. We don't guarantee you any trading profit.  BuyBitcoin24 doesn't offer legal services or company registration in Estonia. You can contact our legal team via website www.consulting24.co.​ We receive an affiliate advertising commission from crypto exchanges and Bitcoin wallets.