IGCSE Computer Science Paper 1 Definitions Worksheet: 5.2 Digital Currency (Modules 500–509)
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Key terms
Write what each term means, in your own words.
1
digital currency
2
digital currency vs cash
3
cryptocurrency
4
digital wallet
5
Paying with digital currency
6
peer-to-peer transfer
7
investment
8
Advantages and risks
9
transaction
10
ledger
Answer Key
IGCSE Computer Science Paper 1 · Modules 500–509 · Student wording will vary for definitions
1digital currency — Money that only exists electronically as data on computers. It has no coins or notes, cannot be held in your hand, and is stored and sent using devices.
2digital currency vs cash — Both pay for goods, but digital currency exists only as electronic records in a wallet, sent over a network with a device and connection, while cash is physical coins and notes handed over.
3cryptocurrency — A kind of digital currency, such as Bitcoin or Ethereum, that exists only electronically and is not printed or controlled by a government or central bank.
4digital wallet — Software or an app on a phone or computer that stores a person's digital currency and is used to send and receive it. Losing access to it can mean losing the currency.
5Paying with digital currency — Spending digital currency online or in shops that accept it to buy goods and services. The payment is sent from your wallet app as an electronic transaction.
6peer-to-peer transfer — Sending digital currency straight from one person's wallet to another's over the internet, even in another country, using the receiver's wallet address. No coins or notes are posted.
7investment — Buying digital currency and holding it, hoping its value rises so you can sell it for a profit. Its value can also fall, so you could lose money.
8Advantages and risks — Digital currency is fast and easy to send, but its value can change quickly, hackers can steal it, a lost password loses access, and not every shop accepts it.
9transaction — A single movement of money from one person to another, such as a payment of an amount from a sender to a receiver. Each one must be recorded.
10ledger — A record book listing every transaction, so you can see who paid whom and how much. It is used to work out balances and keep an accurate history.