A currency exchange is when you convert a currency to another. Usually each country has its own currency and if for example you’re buying an item with a different currency or traveling to a country with a different currency than you, this would require an exchange of currencies where you sell your currency and buy another (this would usually require a conversion fee) through a financial institution.

Currency is a medium of exchange for goods and services replacing the older barter system. In the older times, the exchange between goods and services had no proper foundation for valuing the traded goods and services. It is essentially money issued by the government and is an acceptable form of payment. The modern currency comprises paper and metals in the form of bills and coins. On their own, they are insignificant. The issuing authority and institutions that accept it provide the value; hence it is considered more stable. Countries have developed their currencies over the years based on th

Conversion rate is the ratio between two currencies defining the value of one currency to the other. It is useful in foreign exchange markets for trading purposes, hence why it often fluctuate The supply and demand of the currency dictate the conversion rate. That is why institutions such as the governments or the central banks implement policies to inflate or deflate the rates by increasing or decreasing the country's money supply.