Cryptocurrency is a fully digital, encrypted, virtual currency that can be used in exchange transactions. To some, it's the currency of the future.
Today, cryptocurrencies have caught the attention of everyone from presidents to giant corporations, being a phenomenon with much that is still unknown. Cryptography is used to verify and securely conduct exchange transactions. It does not have any physical counterpart.
Essentially, the money spent and transferred through bank cards and credit cards are also virtual money, because these transactions result in changes only in system data. Cryptocurrencies operate on the same principle. However, there exists a decentralized (not governed by any authority or government) system, making the system more secure.

Cryptology is the science of encryption. It is the encryption of data according to a system. Cryptocurrencies are transferred through the creation and solving of ciphers in the environment. Algorithms like hash functions are used.

Since the technology boom of the 90s, there have been numerous attempts to create a digital currency. Systems like Flooz, Beenz, and DigiCash were developed, but these initiatives failed due to fraud, financial problems, internal disputes, etc. All these efforts developed the concept of a reliable, third-party approach.
The first cryptocurrency, Bitcoin, was developed in early 2009 by an individual or group of people under the pseudonym Satoshi Nakamoto. Although it is said to be developed by Satoshi Nakamoto, it was shared as open-source software by an unidentified person(s). This network operates over a platform with a concept similar to end-to-end encrypted file-sharing platforms.

One of the most significant issues with payment systems is the possibility of the same money being spent twice. The traditional method used to prevent this is to place a central intermediary (banks) that keeps a record of transactions. However, this method means introducing an authority that can control all capital, reducing trustworthiness.
However, in a decentralized, or in other words, distributed network like Bitcoin, every part of the system must approve for a transaction to occur. These transactions are made through blockchain, making every transaction visible to everyone.
All transfer transactions are carried out with the wallet addresses of the sender and receiver and the amount to be sent. The exchange or sending transaction must be verified by the sender and then approved by the system. The approval process can only be done by miners by solving a cryptographic puzzle. Once a transaction is approved, it cannot be reversed. The biggest risks for cryptocurrencies are the possibility of being hacked and attacked.

The production of cryptocurrencies is also carried out through a distributed system, meaning it is user-based. There is a production limit for cryptocurrency units, so as the amount of cryptocurrency produced increases, the transactions that need to be solved to produce cryptocurrency become more difficult.
The production process happens through mining, which involves solving mathematical problems, even though it is not physical mining. Thus, if you have processing power and an internet connection, you can undertake mining independently.

The legality of cryptocurrencies varies from country to country. While the legal status remains uncertain or variable in some, others explicitly allow their use and trade. Some countries have banned or restricted the use of cryptocurrencies.
Questions like "Is Bitcoin legal?" are frequently asked by many people. Currently, the Republic of Turkey has not imposed any laws or restrictions on the use of Bitcoin, so you are not likely to be penalized for holding, buying, or selling Bitcoin or other cryptocurrencies.

Producing Bitcoin or cryptocurrency, i.e., mining, is not a crime. There is no illegal situation.

If regular income is detected in your account, you may be taxed on your earnings. If the Tax Office questions this income, you can state that you earned it from cryptocurrency trading or mining and verify these transactions using your account statements if necessary.