How Crypto currency work? Continued.....

1. 1.       3. Wallets
      
      
      Cryptocurrency users have “wallets” with unique information that confirm them as a temporary owners of their units. Whereas private keys confirm the authenticity of a cryptocurrency transaction wallets lessen the risk of theft for units that aren’t being used. Wallets used but crytocurrency exchange are somewhat vulnerable to hacking -for instance Japan based Bitcoin exchange over its servers.
      
      
      Wallets can be stored on the cloud, an internal hard drive, or an external storage device. Regardless of how a wallet is stored, at least one backup is strongly recommended. Note that backing up a wallet doesn’t duplicate the actual cryptocurrency units, merely the record of their existence and current ownership.
      
      
           4. Miners
      
      
      Miners serve as record-keepers for cryptocurrency communities, and indirect arbiters of the currencies’ value. Using vast amounts of computing power, often manifested in private server farms owned by mining collectives comprised of dozens of individuals, miners use highly technical methods to verify to completeness, accuracy, and security of currencies’ block chains. The scope of operating is not unlike the search for new prime numbers, which also requires tremendous amounts of computing power.
      
      
      Miners’ work periodically creates new copies of the block chain, adding recent, previously unverified transaction that aren’t included in any previous block chain copy – effectively completed those transaction. Each addition is known as a block. Blocks consist of all transactions executed since the last new copy of the block chain was created, usually a few minutes prior.
      
      
      The term “miners” relates to that fact miners work literally creates wealth in the or of brand-new cryptocurrency units. In-fact every newly created block chain copy names with a two-part monetary reward: a newly minted cryptocurrency units, and a variable number o existing units collected from optional traction fees paid by buyers.
      
      
      
      
           5. Finite Supply
      
      
      Although mining periodically produces new cryptocurrency units, most cryptocurrencies are designed to have a finite supply. Generally, this means that miners receives fever new units per new block chain as time goes on. Eventually miners only receive transaction fees for their work.
      
      
      This has yet to happen with any extant cryptocurrency, but observers predict that the last Bitcoin unit will be mined sometime in the mis-22nd century, if current trends continue. Finite supply cryptocurrencies are thus more similar to precious metals, like gold, than to fiat currencies – of which, theoretically, unlimited supplies exist.