A Definition Of Cryptocurrency That Won’t Make Your Head Explode

The nature of cryptocurrency technology and its myriad uses

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Q: What Is Cryptocurrency?

A: Cryptocurrency is digital money.

Let’s start with “what is currency?” Currency is any form of money. The U.S. dollar is a currency. Most countries on Earth have their own currency. Mexico has pesos, China has the yuan, Italy has the lyra, Britain has the pound, and so on.

All of these currencies offer paper banknotes and metal coins. Collectively we call these fiat currencies.

Cryptocurrency can be thought of simply as digital money. Unlike all of the fiat currencies mentioned above, cryptocurrency does not utilize paper notes or coins. There is no physical thing called a bitcoin.

Digital money is nothing new. Fiat money also has a digital component. We all send money back and forth between banks electronically. We pay for things with credit/debit cards and electronic transfers. We can even email fiat money via apps like PayPal and Venmo and Cash App.