A cryptocurrency is a form of payment that uses digital tokens as money. Cryptocurrencies are created using cryptographic techniques that allow anyone to buy, sell or trade them securely. A cryptocurrency can be circulated without a central monetary authority like a government or bank.

Cryptocurrencies are usually created as code by people who build mechanisms for their distribution and other controls. Cryptocurrencies are always increasing, and the next digital token can come tomorrow just like a new day, month or new year.

New in Cryptocurrency

Over 16,000 different cryptocurrencies are traded publicly in the world. The total value of all cryptocurrencies on December 23 2021, was more than $2.3 trillion. Bitcoin, Ethereum, Litecoin, Binance Coin, Polkadot, Tether, Dogecoin, Monero are some of the popular cryptocurrencies of 2021.

Cryptocurrency is very trending right now, and many people are interested in learning about it. With the new year coming, you will come across new terms like DeFi, NFT, DAO in the crypto sector. It can be challenging to understand these terms, but we will break them down for you in this article.

What is DeFi?

The New Year is here, and so are some new terms in the world of cryptocurrency. So, before understanding DeFi let’s understand what a blockchain is. Blockchain is a new technology just like its name, i.e. block and chain. It is a group of virtual blocks that are distributed among users.

One can store any information in these blocks, like transaction details. Decentralised Finance or DeFi is a form of finance based on blockchain technology. It is referred to as decentralised as it does not need other financial mediators, and it allows users to interact with other users through decentralised applications.

What is NFTs?

Non-Fungible Tokens (NFTs) are a digital recording on the blockchain that shows you own a token. The uniqueness of NFTs is that their value is not replaceable. This also means that you can’t trade one NFT for another, and each one is unique. But keep in mind that NFTs are only representations of an item, not the actual item.

What is DAO?

DAO or Decentralised Autonomous Organisation is a company that runs by itself just like decentralised finance. Unlike a traditional company with leaders like a board of directors and CEOs, the DAO is owned by everyone who holds a token and decides what the organisation does.

What is Stablecoin?

Stablecoins are digital currencies that are supported by assets like fiat currency, other cryptocurrencies or gold. The stable assets make these coins less exposed to fluctuations and keep their prices stable. Certain stablecoins also use a computer algorithm to keep their prices stable.

Conclusion

As crypto grows, we will gain a lot of stability, making it easily transferable and a value that will make it more used by businesses, the government, and everyone as a part of everyday life. Cryptocurrency is still in its early stages, and some people are still doubtful about it, but it is here to stay and has been adapted into our lives and can soon be used as a currency by everyone.

With the acceptance and how widely it has been in discussions, the future of cryptocurrency is sure to be bright, as we wish for this new year to be bright and safe for everyone.