Cryptocurrency Market and Cryptocurrency Exchange

Cryptocurrency, a big word but easy to understand! A cryptocurrency or crypto is a digital asset specifically designed to work as a medium of exchange wherein individual coin ownership records are stored in a ledger existing in a form of computerized database using strong cryptography to secure transaction records, to control the creation of additional coins, and to verify the transfer of coin ownership.

Cryptocurrency does not exist in physical form (like paper money), and is not issued by a central authority.

Cryptocurrencies typically use decentralized control as opposed to centralized Digital Currencyand central banking systems. When a cryptocurrency is minted or created prior to issuance or issued by a single issuer, it is generally considered centralized. When implemented with decentralized control, each cryptocurrency works through distributed ledger technology, typically a block chain, which serves as a public financial transaction database.

The main question is how to trade cryptocurrency, what is Cryptocurrency Market, or how to get involved in cryptocurrency exchange? The simplest way to understand, cryptocurrency markets are decent realized, which means they are not issued or backed by a central authority such as government. Instead, they run across a network of computers. However, cryptocurrencies can be bought and sold via exchanges, and are stored in ‘wallets’.

Unlike traditional currencies, cryptocurrencies exist only as a shared digital record of ownership, stored on a block chain. When a user wants to send cryptocurrency units to another user, they send it to that users’ digital wallet. The transaction isn’t considered final until it has been verified and added to the block chain through a process called mining. This is also how new cryptocurrency tokens are usually created, and located in the cryptocurrency market.

Cryptocurrency exchanges are platforms that facilitate the trading of cryptocurrencies for other assets, including digital and fiat currencies. In effect, cryptocurrency exchanges act as an intermediary between a buyer and a seller and make money through commissions and transaction fees.

Buying and selling through cryptocurrency exchange

When you buy cryptocurrencies via exchange, you purchase the coins themselves. You’ll need to create an exchange account in cryptocurrency market, put up the full value of the asset to open a position, and store the cryptocurrency tokens in your own wallet until you’re ready to sell, meaning keeping them in the market till you are ready.

Cryptocurrency exchanges bring their own steep learning curve as you’ll need to get used to the technology involved and learn how to make sense of the data. Many exchanges also have limits on how much you can deposit, while accounts can be very expensive to maintain.

Two types of cryptocurrency exchange

Centralized cryptocurrency exchanges act as a third-party between a buyer and a seller. Since they are operated and controlled by a company, centralized exchanges offer more reliability. Approximately 99 percent of all crypto transactions go through centralized exchanges.

Decentralized cryptocurrency exchanges (DEX) allow users to execute peer-to-peer transactions without the need for a third party or an intermediary.