The 5 basics of cryptocurrencies
3 years ago
Tom Baker Quib.ly Staff Writer Derby, UK
We're just rid of the shiny rememants of Christmas' chocolate coins, and along come a whole new slew of currencies of questionable usability. Bitcoins, Dogecoins, Coinye West...what's the deal with cryptocurrencies?
1. You don't need to know everything
You either need an Economics degree, or the amount of free time required to get an Economics degree, to understand the Wikipedia article on cryptocurrencies. You don't really need to know all the ins and outs of how Bitcoins are generated, mind, in the same way you don't need a guided tour of the Royal Mint to start buying stuff in shops with pounds. If you do want to dig in, mind, there are some good guides online.
2. The basics
Cryptocurrencies are just, well, currencies. Except, instead of having physical cash in your hand, it exists only digitally, in your account. Which means, in theory, they can't be lost by greedy banks. They can, however, be affected by infaltion.
3. You shouldn't be worried
In case you were worried, your kids aren't going to be investing heavily in Dogecoins. For one thing, if your tike understands cryptocurrencies, you've probably got bigger problems on your hands, Mr and Mrs Luthor/Blofeld/Doom. For another, buying into stuff like Bitcoin more often than not requires actual money to exchange. Which means bank cards and the like.
4. No, really
And if you're worrying in general about switching from whatever national currency you currently use in favour of this 'open source' online alternative: don't. So far Bitcoins are accepted on a (relative) handful of websites and a pub in London. Plus last year it suffered a bunch of 'crashes' in value.
5. But the future looks interesting