What is cryptocurrency in UPSC exam?

In the UPSC exam, cryptocurrency refers to a digital or virtual currency that uses cryptography for security, making it difficult to counterfeit. It operates independently of a central bank and is not issued by any government. Cryptocurrencies, such as Bitcoin, operate on a decentralized ledger system known as blockchain, which records all transactions chronologically and publicly. The value of cryptocurrencies is derived from their scarcity, acceptance, and utility. In the UPSC context, it's important to understand the technology, its implications, and potential risks to national economies and financial systems. Candidates are expected to demonstrate knowledge of the underlying principles and implications of cryptocurrencies in modern financial systems.