Cryptocurrency explained in 2 minutes
What is cryptocurrency?
Cryptocurrency is a form of internet money. To understand what cryptocurrency is, we need to first understand the two main categories of money that we see today: cash and digital money.
We all know cash — our banknotes and coins. Cash is physical money that allows us to transact in physical shops and in-person.
Digital money is the money that is in our bank accounts, in PayPal, and any other e-wallet service we might use. It allows us to transact without carrying physical cash.
The main limitation of digital money today is that we are not the sole owner of our money. When it goes into a bank account or an e-wallet, someone else — be it a bank or a service — owns and controls our money.
We feel this lack of ownership most commonly when the bank's ATM network is down (or on holiday!) and we are unable to withdraw our money, or when we are unable to transfer our money into a different country, much less to a different bank.
You have limited control of your money, even though it is your money.
This is where we can answer the question, what is cryptocurrency?
Cryptocurrency is the first digital money that you completely own.
One important aspect of this ownership is that cryptocurrency is programmable money. What this means is that it allows anyone, anywhere, to build on top of it.
Before cryptocurrencies, most people have had to rely on banks to provide financial services. Sometimes the services that are required can take decades to build, or a problem is not profitable enough to justify a bank building a solution.
Today, anyone with expertise can build on top of cryptocurrencies to create the financial services that they need, regardless of scale. If you need a service that no bank currently provides, you can build a custom financial solution using cryptocurrencies, even if it serves just your family.
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