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How Does Cryptocurrency Work?

By Lyle Daly – Updated Mar 1, 2025 at 12:46PM

Key Points

  • Cryptocurrencies are digital, decentralized currencies secured by cryptography.
  • Nodes validate transactions in grouped blocks using consensus mechanisms, such as proof of work or proof of stake.
  • Blockchain technology records every transaction in a tamper-proof distributed ledger.
Key findings are powered by ChatGPT and based solely off the content from this article. Findings are reviewed by our editorial team. The author and editors take ultimate responsibility for the content.

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