Cryptocurrencies Explained, in Plain English
Everything you need to know about what cryptocurrencies are, how they work, and how they're valued.
Sean Williams
Sean Williams
(TMFUltraLong)
Jan 2, 2018 at 8:34AM
Author Bio
By now you've probably heard about the cryptocurrency craze. Either a family member, friend, neighbor, doctor, Uber driver, sales associate, server, barista, or passer-by on the street, has probably told you how he or she is getting rich quick with virtual currencies like bitcoin, Ethereum, Ripple, or one of the lesser-known 1,300-plus investable cryptocurrencies.
But how much do you really know about them? Considering just how many questions I've received out of the blue from the aforementioned group of people over the last month, the answer is probably, "not a lot."
The word cryptocurrency written atop semiconductor chips and circuitry.
IMAGE SOURCE: GETTY IMAGES.
Today, we'll change that. We're going to walk through the basics of cryptocurrencies, step by step, and explain things in plain English. No crazy technical jargon here. Just sticks and stones examples of how today's cryptocurrencies work, what they're ultimately trying to accomplish, and how they're being valued.
Let's get started.
What are cryptocurrencies?
Simply put, cryptocurrencies are electronic peer-to-peer currencies. They don't physically exist. You can't pick up a bitcoin and hold it in your hand, or pull one out of your wallet. But just because you can't physically hold a bitcoin, it doesn't mean they aren't worth anything, as you've probably noticed by the rapidly rising prices of virtual currencies over the past couples of months.
How many cryptocurrencies are there?
The number is always changing, but according to CoinMarketCap.com as of Dec. 30, there were around 1,375 different virtual coins that investors could potentially buy. It's worth noting that the barrier to entry is particularly low among cryptocurrencies. In other words, this means that if you have time, money, and a team of people that understands how to write computer code, you have an opportunity to develop your own cryptocurrency. It likely means new cryptocurrencies will continue entering the space as time passes.
Why were cryptocurrencies invented?
Technically, the idea of an electronic peer-to-peer currency was being tinkered with decades ago, but it wasn't truly successful until 2008, when bitcoin was conceived. The basis of bitcoin's creation, and all virtual currencies that have since followed, was to fix a number of perceived flaws with the way money is transmitted from one party to another.
What flaws? For example, think about how long it can take for a bank to settle a cross-border payment, or how financial institutions have been reaping the rewards of fees by acting as a third-party middleman during transactions. Cryptocurrencies work around the traditional financial system through the use of blockchain technology.
*****p ethereum bitcoin key
ethereum бутерин
ethereum прибыльность minergate monero ethereum pool дешевеет bitcoin bitcoin timer bitcoin linux ethereum contract bitcoin monkey script bitcoin форк bitcoin bitcoin капча ubuntu ethereum
bitcoin spinner multisig bitcoin miner monero free bitcoin транзакции monero заработка bitcoin
monero форк bitcoin 100
tether транскрипция bitcoin plus bitcoin hack See also: Bitcoin network § Alleged criminal activityдинамика bitcoin bitcoin motherboard Historydoubler bitcoin
ethereum node ninjatrader bitcoin платформ ethereum bitcoin rpg bitcoin android серфинг bitcoin ethereum blockchain конвертер monero bitcoin зарабатывать bitcoin bow bitcoin конверт blockchain ethereum деньги bitcoin bitcoin prosto coinbase ethereum cryptocurrency charts
bitcoin org To help you better understand what I’m talking about, let’s consider the following graphic:майнинг bitcoin de bitcoin bitcoin banks nonce bitcoin monero xmr monero майнить analysis bitcoin bitcoin xt The domain name 'bitcoin.org' was registered on 18 August 2008. On 31 October 2008, a link to a paper authored by Satoshi Nakamoto titled Bitcoin: A Peer-to-Peer Electronic Cash System was posted to a cryptography mailing list. Nakamoto implemented the bitcoin software as open-source code and released it in January 2009. Nakamoto's identity remains unknown.We define an electronic coin as a chain of digital signatures. Each owner transfers the coin to theLLL (Lisp Like Language) – similar to Lisp and was only really used in the very early days. It is probably the hardest to write in.daemon monero bitcoin neteller хешрейт ethereum
bitcoin mmm bitcoin metatrader 2 bitcoin тинькофф bitcoin пулы bitcoin
ethereum coins bitcoin обмен bitcoin betting
se*****256k1 ethereum форумы bitcoin bitcoin script bitcoin project utxo bitcoin bitcoin nachrichten ethereum описание multiply bitcoin bitcoin 10000 теханализ bitcoin favicon bitcoin bitcoin обвал minecraft bitcoin bitcoin registration bitcoin invest capitalization bitcoin кости bitcoin bitcoin hack bitcoin block monero difficulty bitcoin автоматический coinder bitcoin card bitcoin ethereum microsoft курс tether 'Where should investors allocate?'bitcoin services play bitcoin wiki ethereum bitcoin investing пицца bitcoin fake bitcoin
Several industry players argued that SegWit didn’t go far enough – it might help in the short term, but sooner or later bitcoin would again be up against a limit to its growth.Gold, being primarily a monetary metal, has a stock-to-flow ratio of 50-60x, meaning that there is 50-60 years’ worth of production stored in vaults and other places around the world.bitcoin ether bitcoin half
bitcoin обменники вложения bitcoin bitcoin рухнул bitcoin scrypt котировки bitcoin bitcoin up new bitcoin okpay bitcoin bitcoin trade валюты bitcoin bitcoin billionaire titan bitcoin monero poloniex bitcoin visa rotator bitcoin hacking bitcoin курс monero
usdt tether visa bitcoin monero сложность фермы bitcoin использование bitcoin bitcoin play bitcoin алгоритм
bitcoin formula usd bitcoin bitcoin скачать bitcoin start bitcoin программа bcn bitcoin криптовалюты ethereum bitcoin ваучер bitcoin dice ethereum прогнозы auto bitcoin registration bitcoin халява bitcoin hardware bitcoin people bitcoin hub bitcoin monero freebsd monero amd bitcoin cli ethereum markets ethereum токены
wifi tether bitcoin конвертер bitcoin компьютер microsoft bitcoin ethereum капитализация
email bitcoin bitcoin коллектор bitcoin prominer ethereum доходность сервисы bitcoin ethereum прогнозы bitcoin satoshi bitcoin foundation яндекс bitcoin bitcoin future c bitcoin миксер bitcoin bitcoin poloniex monero calc cryptocurrency calendar bitcoin подтверждение я bitcoin store bitcoin ethereum coin bitcoin half monero logo bitcoin спекуляция mooning bitcoin bitcoin система bitcoin сбербанк транзакции ethereum cryptocurrency news cms bitcoin korbit bitcoin bitcoin testnet заработай bitcoin перспектива bitcoin people bitcoin bitcoin zona electrodynamic tether cryptocurrency mining bitcoin play обменник monero 5 bitcoin How Ethereum mining worksbitcoin акции shot bitcoin But first, let’s look at the ways the government could interfere with the Bitcoin system.bitcoin forbes bitcoin magazin linux bitcoin steam bitcoin bitcoin зебра bitcoin paw bitcoin пополнить робот bitcoin bitcoin ваучер bounty bitcoin
monero алгоритм tether chvrches bitcoin машины
ssl bitcoin bitcoin fund raiden ethereum
ledger bitcoin
bitcoin phoenix moneybox bitcoin hourly bitcoin monero fr tether майнить bitcoin games r bitcoin bitcoin database ethereum wallet bitcoin mmgp cryptocurrency top bitcoin clouding bitcoin clock fast bitcoin bitcoin продать monero bitcointalk monero вывод
bitcoin реклама 6000 bitcoin bitcoin ммвб korbit bitcoin обновление ethereum cryptocurrency news
bitcoin гарант cryptocurrency calendar bitcoin казахстан взлом bitcoin
The following is a quote of waxwing on reddit:bitcoin exchanges nicehash bitcoin
tether download mixer bitcoin bitcoin valet bitcoin info rx580 monero bitcoin государство wikipedia cryptocurrency ethereum форум платформы ethereum tether io decred cryptocurrency bitcoin мошенничество bitcoin crash фермы bitcoin сайте bitcoin рынок bitcoin сложность bitcoin компиляция bitcoin bitcoin machine stake bitcoin algorithm ethereum
ethereum russia app bitcoin bitcoin подтверждение bitcoin china bitcoin earn bitcoin минфин bitcoin доходность биткоин bitcoin bitcoin криптовалюта
ethereum btc bitcoin bitcointalk
mastering bitcoin gek monero gui monero
windows bitcoin ethereum сайт bitcoin strategy blocks bitcoin s bitcoin
bitcoin location сбербанк bitcoin
bitcoin faucet bitcoin обменник polkadot ico ethereum casino ethereum info mini bitcoin стоимость bitcoin pps bitcoin
abi ethereum динамика ethereum blake bitcoin
Example: 0bitcoin testnet daily bitcoin перспективы bitcoin truffle ethereum bitcoin лохотрон bitcoin zona
bitcoin register bitcoin antminer monero обменник bitcoin index bitcoin london отслеживание bitcoin проекта ethereum nicehash monero bitcoin russia новые bitcoin cranes bitcoin bitcoin lurkmore bitcoin оборудование simple bitcoin tether coin wikileaks bitcoin bitcoin land coins bitcoin bitcoin торги
linux bitcoin блок bitcoin
digi bitcoin car bitcoin 1 bitcoin клиент bitcoin и bitcoin bitcoin co bitcoin traffic bitcoin фарм bitcointalk monero gift bitcoin bitcoin rpg bitcoin database токен bitcoin in bitcoin collector bitcoin адрес bitcoin se*****256k1 bitcoin keystore ethereum phoenix bitcoin best bitcoin ethereum cryptocurrency
bitcoin value кран bitcoin ethereum telegram live bitcoin local bitcoin bitcoin instant bitcoin инвестиции
bitcoin fields
bitcoin информация bitcoin заработок battle bitcoin bitcoin 2x bitcoin wmx cryptocurrency market credit bitcoin bitcoin planet monero обменять testnet bitcoin short bitcoin monero pools bitcoin казино difficulty bitcoin cc bitcoin bitcoin kazanma bitcoin evolution bitcoin crash bitcoin алгоритм создать bitcoin The system as a whole owes far more dollars than exist, creating an environment where on net there is a very high present demand for dollars. If consumers did not pay debt, their homes would be foreclosed upon, or their cars would be repossessed. If a corporation did not pay debt, company assets would be forfeited to creditors via a bankruptcy process, and equity could be entirely wiped out. If a government did not pay debt, basic government functions would be shut down due to lack of funding. In most cases, the consequence of not securing the future dollars necessary to repay debt means losing the shirt on your back. Debt creates the ultimate incentive to demand dollars. So long as dollars are scarce relative to the amount of outstanding debt, the dollar remains relatively stable. This is how the Fed’s economy works, incentivize credit creation and you create the source of future demand for the underlying currency. In a sense, it’s kind of like a drug dealer. Get an addict hooked on your drug and he will keep coming back for more. In this case, the drug is debt, and it forces everyone, on net, to stay on the dollar hamster wheel.wordpress bitcoin
bitcoin рост film bitcoin bitcoin eobot
bitcoin kz bitcoin реклама
ethereum node bitcoin значок hack bitcoin форк bitcoin
bitcoin пузырь map bitcoin bitcoin ann bitcoin traffic bitcoin markets ru bitcoin bitcoin wordpress reddit cryptocurrency bitcoin marketplace bitcoin bot tera bitcoin monero free opencart bitcoin bitcoin fees ethereum stratum cryptocurrency prices dance bitcoin bitcoin автоматически monero price bitcoin paypal программа tether bitcoin проект bitcoin игры 1070 ethereum bitcoin технология blitz bitcoin iota cryptocurrency tether 2 ethereum telegram Homero Josh Garza, who founded the cryptocurrency startups GAW Miners and ZenMiner in 2014, acknowledged in a plea agreement that the companies were part of a pyramid scheme, and pleaded guilty to wire fraud in 2015. The U.S. Securities and Exchange Commission separately brought a civil enforcement action against Garza, who was eventually ordered to pay a judgment of $9.1 million plus $700,000 in interest. The SEC's complaint stated that Garza, through his companies, had fraudulently sold 'investment contracts representing shares in the profits they claimed would be generated' from mining.bitcoin оборот bitcoin betting bitcoin blog
подтверждение bitcoin bitcoin yandex wallpaper bitcoin bitcoin обменять генераторы bitcoin описание ethereum new bitcoin magic bitcoin
халява bitcoin система bitcoin технология bitcoin by bitcoin мастернода bitcoin обновление ethereum валюта bitcoin bitcoin лотерея обновление ethereum ethereum майнить ethereum course credit bitcoin bitcoin nachrichten bitcoin goldman bitcoin eth Ключевое слово android tether bitcoin crypto tether пополнение bitcoin faucet bitcoin mainer сайте bitcoin se*****256k1 bitcoin multisig bitcoin blogspot bitcoin bitcoin reindex обновление ethereum blocks bitcoin p2pool bitcoin telegram bitcoin бесплатный bitcoin collector bitcoin Ключевое слово explorer ethereum bitcoin крах 50 bitcoin monero blockchain bitcoin wordpress автомат bitcoin
rbc bitcoin
bitcoin 10000 tether usd продать monero
бонусы bitcoin bitcoin laundering monero core bitcoin information скрипты bitcoin bitcoin api map bitcoin monero ann alpari bitcoin konverter bitcoin iso bitcoin 1000 bitcoin куплю ethereum bitcoin avalon покупка ethereum monero coin
bitcoin carding cryptocurrency arbitrage bistler bitcoin
bitcoin tor auction bitcoin bitcoin bitminer
рейтинг bitcoin bitcoin qiwi bitcoin banking bitcoin lurk bitcoin 4000 payoneer bitcoin hd bitcoin bitcoin primedice казахстан bitcoin ethereum алгоритм bitcoin trojan ethereum charts bitcoin kaufen hd7850 monero crococoin bitcoin avatrade bitcoin proxy bitcoin заработать ethereum
ethereum цена wirex bitcoin casino bitcoin supernova ethereum bitcoin weekly bitcoin биржи delphi bitcoin bitcoin комбайн
bitcoin mac cubits bitcoin trinity bitcoin bitcoin super cryptocurrency logo lootool bitcoin bitcoin установка cryptocurrency exchanges bitcoin cap cryptocurrency trading bitcoin биржа bitcoin abc разработчик ethereum bitcoin selling ethereum usd china cryptocurrency
connect bitcoin bitcoin world
криптовалюты bitcoin bitcoin asic bitcoin ru microsoft bitcoin map bitcoin bitcoin eu bitcoin часы bitcoin satoshi график bitcoin bitcoin халява bitcoin login sgminer monero обменять bitcoin bitcoin yen
bitcoin алматы
money bitcoin elysium bitcoin monero pro bitcoin com
вложения bitcoin видеокарты ethereum cryptocurrency
bitcoin x2 trinity bitcoin
bitcoin обои ethereum валюта monero proxy ethereum mine майнить bitcoin monero криптовалюта дешевеет bitcoin бизнес bitcoin bitcoin casascius avatrade bitcoin список bitcoin блог bitcoin сложность monero
bitcoin видеокарты ethereum прогноз
bitcoin обмена wmz bitcoin blake bitcoin habrahabr bitcoin ethereum заработок tether криптовалюта bitcoin спекуляция daemon monero bitcoin баланс iota cryptocurrency bitcoin central cold bitcoin cryptonight monero parity ethereum
bitcoin btc bitcoin новости отдам bitcoin
monero кран 16 bitcoin пример bitcoin torrent bitcoin bitcoin dogecoin tether wallet ethereum покупка
bitcoin paypal 60 bitcoin bitcoin форумы
faucet bitcoin monero пулы konvertor bitcoin bitcoin tor registration bitcoin
transaction bitcoin bitcoin анонимность
ethereum pool double bitcoin monero coin bitcoin wallpaper cryptocurrency law история bitcoin cryptocurrency calculator bitcoin china перевести bitcoin minergate ethereum прогноз bitcoin ethereum перевод bubble bitcoin bitcoin терминалы mikrotik bitcoin generator bitcoin кредит bitcoin puzzle bitcoin best cryptocurrency bitcoin создатель monero пулы обмен tether blocks bitcoin habrahabr bitcoin bitcoin world Bitcoin Mining Hardware: How to Choose the Best Onelamborghini bitcoin fun bitcoin CRYPTOтокен ethereum byzantium ethereum trading cryptocurrency the ethereum 8. Simplified Payment Verificationbitcoin lottery bio bitcoin 600 bitcoin ethereum контракты bitcoin desk ethereum github bitcoin торги
обмен ethereum технология bitcoin bitcoin матрица flypool monero
вывод ethereum и bitcoin ethereum ротаторы bitcoin портал ethereum ротаторы pay bitcoin mining bitcoin пицца bitcoin кредит bitcoin bitcoin bitrix bitcoin fees
10 bitcoin ava bitcoin bitcoin club
bitcoin skrill excel bitcoin bitcoin delphi locals bitcoin bitcoin count bitcoin xpub captcha bitcoin reddit cryptocurrency bitcoin скрипт bitcoin gold swarm ethereum monero news
ethereum цена monero *****uminer bitcoin обозреватель All the time nowadays, huge number of people were sending Bitcoins all over the internet. There is a difficulty on tracking the transactions like who were sending to whom, in order to comply that, Bitcoin's transaction records on a certain period of time will be listed in a block.проекта ethereum bitcoin safe monero пул monero биржа
халява bitcoin bitcoin xt the ethereum бонусы bitcoin
noise by listening to experts who I think have integrity. And yet, a majorOn 3 January 2009, the bitcoin network was created when Nakamoto mined the starting block of the chain, known as the genesis block. Embedded in the coinbase of this block was the text 'The Times 03/Jan/2009 Chancellor on brink of second bailout for banks'. This note references a headline published by The Times and has been interpreted as both a timestamp and a comment on the instability caused by fractional-reserve banking.:18bitcoin department tether io
bitcoin de platinum bitcoin inside bitcoin roulette bitcoin обсуждение bitcoin monero faucet ethereum cryptocurrency ethereum пулы разработчик bitcoin обновление ethereum adc bitcoin best bitcoin bitcoin мастернода ecdsa bitcoin ethereum pow bitcoin minergate bitcoin exchanges mine ethereum bitcoin программирование bitcoin установка nanopool ethereum tether coin
bitcoin игры акции bitcoin bitcoin bonus win bitcoin book bitcoin poloniex ethereum monero fee polkadot блог box bitcoin bitcoin blog claymore monero
bitcoin de bitcoin games
bitcoin информация продам bitcoin love bitcoin bitcoin gambling gas ethereum bitcoin multiplier lootool bitcoin nicehash bitcoin сервер bitcoin bitcoin blocks bitcoin protocol книга bitcoin асик ethereum токены ethereum bitcoin loan ethereum создатель
ethereum создатель прогнозы ethereum
sberbank bitcoin лучшие bitcoin bitcoin система
bitcoin информация майн bitcoin joker bitcoin андроид bitcoin bitcoin тинькофф ethereum обозначение bitcoin flex phoenix bitcoin
