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If a network is described as peer-to-peer, or P2P, it means that all connected systems — i.e., nodes — share the same privileges. Cryptocurrency networks are peer-to-peer because all nodes are of equal authority, and transaction data is shared among nodes without reliance on coordination from a centralized server with additional privileges.

Anyone can join a peer-to-peer network. All they need is a device, a way to connect with other nodes (usually the internet) and a piece of software. As well as its use in cryptocurrencies, peer-to-peer networking was used in early file-sharing applications like Napster and LimeWire.

Disclaimer: This material should not be taken as the basis for making investment decisions, nor be construed as a recommendation to engage in investment transactions. Trading digital assets involve significant risk and can result in the loss of your invested capital. You should ensure that you fully understand the risk involved and take into consideration your level of experience, investment objectives and seek independent financial advice if necessary.