Decentralized cryptocurrency networks – at least the ones that truly deserve the name – are based on blockchain technology. It is not used in the traditional financial system, which is heavily centralized. Blockchain technology is one of the greatest assets of digital currencies. It makes it possible to obliquely record and almost instantly confirm all transactions occurring within a given network.
The blockchain is a vast virtual ledger in which literally every transaction is recorded. So no mistake can be made: the network knows precisely how much money someone should have in their wallet. The record of transactions that have occurred cannot be modified in any way. This is why cryptocurrencies offer a relatively higher level of security compared to electronic banking.