1. Blockchain – A distributed ledger system that uses cryptography to record and secure data.
2. Mining – This is the process of verifying and adding new transactions to the blockchain. Miners use powerful computers to solve complex mathematical problems to verify new blocks of transactions.
3. Cryptography – This is the science of encoding and decoding messages so that unintelligible information can be sent securely between users. Cryptography is used to secure the cryptocurrency networks, and to prevent counterfeiting.
4. Wallets – Digital wallets are used for storing, sending and receiving cryptocurrencies. Wallets typically consist of two keys; a public key (used for sending and receiving funds) and a private key (used to spend the funds).
5. Exchange Platforms – Cryptocurrency exchanges are platforms where users can buy and sell various cryptocurrencies. These exchanges operate similarly to stock exchanges, allowing traders to speculate on the value of virtual coins.