I want to know whether a cryptocoin is made of some piece of code or it is kind of a bill that says a person has transferred conceptual coin to another person when a transaction is published. If it is a piece of code, how it is made.

thank you.

  • I've got the inkling of an idea that this either has an answer here or is considered too broad, but for me it's hard to tell for such a generic question (and topic wise it does belong here I suppose). So yeah, blame me for not closing it... your friendly crypto mod. Jun 25, 2019 at 13:35

2 Answers 2


A cryptocoin is a piece of information, like a text in some language.

What a cryptocoin says depends on conventions set by the cryptocurrency system, much like what a given text says depends on the language.

A cryptocoin is made by some piece of computer code, which has output it. It usually is not made of some piece of computer code, in the sense that a computer, interpreter, Turing machine.. could run it directly. It is fed as input to some computer code (e.g for validity verification, spending..).

How a cryptocoin is made, and what makes it valid, also depends on the cryptocurrency system. In decentralized ones, the making typically involves doing a large amount of arbitrary cryptographic computations.

  • 1
    Maybe "A cryptocoin is acknowledged by some piece of computer code"? The "coin" part is an abstract concept, like the value of normal money. Whether it is usable in a transaction depends on whether a process recognizes that coin as legitimate.
    – Future Security
    Jun 24, 2019 at 18:09

Speaking of bitcoin (I suspect other cryptocurrencies are similar but I have not looked at them in detail).

Coins per-se don't really exist as independent items, they are just a "unit of account" used to measure balances.

Each regular transaction takes one or more input balances and produces one or more output balances. Outputs from previous transactions form inputs to later transactions. Cryptographic signatures are used to control who can spend each output.

The blockchain acts as a central ledger to record the sequence of accepted transactions and hence the balances that are currently available for spending. This is needed to prevent people from spending the same balance twice. It also acts (through special "coinbase transactions") as a mechanism for initial distribution of coins.

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