Let's understand what is the meaning of cryptocurrency in the most simplified manner. Cryptocurrency is divided into two parts :-

1. Cryptography

2. Cryptocurrency

What is Cryptography ?

First let's try to understand what is cryptography. Cryptography is associated with the process of converting ordinary plain text into unintelligible text and vice versa. Unintelligible means which can't be understood. It is the process of converting plain text into text which can't be easily understood. It is a method of storing and transmitting data in a particular form so that only those for whom it is intended can read and process it.

Read this example for better know about cryptography - See the moment when you read this that it is done in a particular way so that only that person to whom it is intended can read and understand it remember the movie Razi in which Aliyah Bhatt used to make certain noises like this (tik tik tik ……..) from Pakistan and then in India there is a person who is listening to this voice (tik tik tik …….) and then he understands, she's communicating this to me. Now, anyone else on earth if he would have heard that noise he would not have understood that but the sender knows what he means to say and the receiver also knows what he or she needs to understand from it that is actually cryptography.

What is Cryptocurrency ?

Now, let's understand the combined term what is cryptocurrency. Cryptocurrency in simple words is nothing but digital form of cash. Now let's take this example, here we have a let us say any person (a) and here we have (a) is in India and there is one more person (b) who is from USA. Now, if a wants to send dollars to (b) in USA can that person directly send dollars no he or she will have to first go to a bank, then bank is a third party who is involved who will actually convert the rupees into dollars and then verify who is the sender, who is the receiver.

We'll match certain things, we'll charge some money and then transfer the funds to (b). This transaction was possible only with the help of an intermediary which was the bank here. Now let's try to understand, if there was something like a digital form of currency which knows no barriers. Something like that a currency it's nothing but a digital form of cash.

So, what could have happened that Mr (a) could have directly sent funds to (b) without any third party and that is an example of cryptocurrency.

What are the advantages of Cryptocurrency ?

1. No intermediary required

2. 2. No geographical barrier

3. 3. Less charges

4. 4. Very fast transfer money

What are the disadvantages of Cryptocurrency ?

1. Transactions are irreversible

If a wrong transfer is made, then this person a cannot ask for the money back. Why i'll tell you because let us say the account to whom the money was to be transferred was account number six four five and by mistake the person said six five four. Now, he does not know who is six five four that person does not know, who is six five four. No one knows who is 654 so once money is gone, it can't you get it back. If it is a wrong transfer this could have happened, if bank was there in between because bank knows who is 654.

2. Used for illegal activity

The senders and the receivers identity is not unveiled unfortunately it is used for a lot of illegal activities through internet which is many times a part of internet which is known as dark web.