What Is Cryptocurrency?
Cryptocurrency is digital money secured by cryptography rather than issued by a central bank or government. Instead of a bank keeping the official record of who owns what, a cryptocurrency network keeps a shared, public record called a blockchain — and thousands of independent computers around the world agree on it, rather than one central authority.
How it’s different from regular money
Rupees, dollars and other government-issued currencies are controlled by a central bank, which can print more of them and sets monetary policy. Cryptocurrencies have a fixed or predictable supply set by their underlying code — Bitcoin, for example, will only ever have 21 million coins. No single company or government can unilaterally issue more.
Bitcoin and Ethereum
Bitcoin, launched in 2009, was the first cryptocurrency and remains the largest by market value — designed primarily as a store of value and payment network. Ethereum, launched in 2015, added the ability to run programs (smart contracts) on its blockchain, which is the foundation most DeFi and Web3 applications are built on.
How transactions work
When you send cryptocurrency, the transaction is broadcast to the network, verified by participants (through mechanisms like Proof of Work or Proof of Stake), and permanently recorded on the blockchain. There’s no bank in the middle — but that also means there’s usually no customer support line to reverse a mistaken transfer, which is why understanding wallets and addresses matters before using any of this for real.
Cryptocurrency in India
India does not ban owning or trading cryptocurrency, but treats it as a "Virtual Digital Asset" (VDA) for tax purposes rather than legal tender. Gains are taxed, and exchanges deduct TDS on transactions — see our dedicated guide on crypto tax in India for the specifics.
Not investment advice
This page is general information for education only, not investment, legal, or tax advice. Rules and risks can change — do your own research and consult a qualified professional before acting on anything here.