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.
bitcoin 5 математика bitcoin trade bitcoin
monero dwarfpool
lightning bitcoin ethereum contracts transaction bitcoin ethereum настройка bitcoin analysis bitcoin nonce bitcoin математика запросы bitcoin usb tether bitcoin мерчант bitcoin транзакция bitcoin official fasterclick bitcoin сервер bitcoin bitcoin earning ethereum miners криптовалюты bitcoin ethereum график decred ethereum кран bitcoin bitcoin анимация bitcoin stellar bitcoin x2
bitcoin alliance
bitcoin ruble bitcoin super обзор bitcoin ethereum хешрейт bitcoin spinner бот bitcoin bitcoin основы
приват24 bitcoin bitcoin london cryptocurrency price ethereum алгоритм ethereum ethash raiden ethereum покупка ethereum ethereum проблемы
bitcoin money bitcoin auto
bitcoin usb продажа bitcoin 100 bitcoin rpc bitcoin криптовалюты bitcoin bitcoin video cms bitcoin little bitcoin токен bitcoin bitcoin скрипт bitcoin cms bitcoin blog bazar bitcoin china cryptocurrency bitcoin продам bitcoin crypto
bitcoin vk monero miner ubuntu bitcoin In the wake of the 2008 financial crisis, a new and soon-to-be revolutionary technology was brought into the world. Satoshi Nakomoto (a name which remains but a pseudonym to this day) published the Bitcoin Whitepaper, proposing a Peer-to-Peer Electronic Cash System which would allow online payments to be sent over the internet without using a bank or institution as an intermediary. The Bitcoin whitepaper was first published publicly on 31 October 2008.Agricultural commodities, oil, copper, iron, and other industrial commodities generally have stock-to-flow ratios that are below 1x, meaning that the amount of them that is stored is equal to less than one year’s worth of production. Most of them rot or rust, or are very large relative to their price and thus costly to store. So, people produce just as much as they need in the near future, with a little bit of storage to last for months or at most a year or two.bitcoin virus лучшие bitcoin bitcoin мошенничество bitcoin gif bitcoin шахты debian bitcoin пулы bitcoin bitcoin ann bitcoin hash шифрование bitcoin
кран ethereum bitcoin check ethereum code bitcoin бесплатный doge bitcoin
cryptocurrency wallet bitcoin casino серфинг bitcoin ethereum studio market bitcoin
cpuminer monero bitcoin steam кредит bitcoin установка bitcoin bitcoin путин команды bitcoin обновление ethereum multiply bitcoin лучшие bitcoin
bitcoin click мастернода bitcoin bitcoin ставки bitcoin котировка верификация tether криптовалют ethereum баланс bitcoin ethereum майнить monero xmr bonus bitcoin ethereum продам ethereum cryptocurrency хардфорк monero daemon monero instaforex bitcoin yandex bitcoin cryptocurrency ico играть bitcoin
mining ethereum ethereum vk 6) Counterfeitabilitybitcoin рбк
торговать bitcoin bitcoin мошенничество bitcoin conference ethereum эфир bitcoin scripting
bitcoin инструкция top cryptocurrency bitcoin x2 обменники bitcoin bitcoin форк Most cryptocurrency wallets are digital, but hackers can sometimes gain access to these storage tools in spite of security measures designed to prevent theft.ethereum blockchain
topfan bitcoin bitcoin habrahabr clockworkmod tether r bitcoin
bitcoin anonymous ios bitcoin добыча bitcoin ethereum доходность kinolix bitcoin ethereum стоимость платформ ethereum ферма bitcoin bitcoin эфир bitcoin выиграть bitcoin russia обменник tether ethereum виталий best bitcoin оборот bitcoin bitcoin blockchain криптовалюта tether ethereum логотип bitcoin zona tether coin купить bitcoin bitcoin суть tor bitcoin bitcoin обмен bitcoin play bitcointalk bitcoin надежность bitcoin bitcoin anonymous bitcoin win bitcoin окупаемость super bitcoin pool bitcoin mmgp bitcoin bitcoin logo putin bitcoin clame bitcoin monero address flex bitcoin
black bitcoin котировки ethereum monero обменять monero spelunker bitcoin steam bitcoin fund bitcoin пополнить bitcoin бизнес nanopool monero bitcoin блок fox bitcoin
bitcoin бонусы bitcoin вебмани блок bitcoin майн bitcoin invest bitcoin bitcoin nyse робот bitcoin
bitcoin golden bitcoin pro казино ethereum команды bitcoin bitcoin hourly bitcoin количество bitcoin novosti сбербанк ethereum bitcoin php ethereum пулы bitcoin euro segwit bitcoin ethereum decred проекта ethereum
The concept of a multi-signature has gained some popularity; it involves an approval from a number of people (say 3 to 5) for a transaction to take place. Thus this limits the threat of theft as a single controller or server cannot carry out the transactions (i.e., sending bitcoins to an address or withdrawing bitcoins). The people who can transact are decided in the beginning and when one of them wants to spend or send bitcoins, they require others in the group to approve the transaction.What Is Cold Storage For Bitcoin✓ The final advantage is that you don’t need to know anything about cryptocurrency mining. If you want to cloud mine, you probably don’t need this guide on how to mine Bitcoin at all!bitcoin electrum bitcoin окупаемость monero
plus bitcoin установка bitcoin bitcoin timer surf bitcoin golden bitcoin
заработать monero монета ethereum bitcoin node copay bitcoin
bitcoin code bitcoin обои лото bitcoin bitcoin motherboard ethereum metropolis bounty bitcoin ann monero bitcoin инструкция top bitcoin cz bitcoin bitcoin tradingview дешевеет bitcoin bitcoin usd trade cryptocurrency bitcoin сложность bitcoin завести my bitcoin ethereum decred bitcoin maps drip bitcoin fpga ethereum bitcoin пузырь tether 2 bitmakler ethereum
bitcoin config обменник bitcoin bitcoin транзакция bitcoin usa monero майнить cryptocurrency ico bitcoin таблица bitcoin fpga протокол bitcoin bitcoin net local bitcoin халява bitcoin ethereum torrent reddit bitcoin bitcoin knots ethereum обменять my ethereum bitcoin руб bitcoin store bitcoin flip
доходность ethereum bitcoin wallet etf bitcoin ethereum pool importprivkey bitcoin bitcoin dice bitcoin virus ethereum хешрейт monero сложность продам bitcoin 4 bitcoin
bitcoin орг что bitcoin bitcoin code bitcoin coins bitcoin stealer вложения bitcoin bitcoin fire bitcoin bat bye bitcoin раздача bitcoin bitcoin игры обменники bitcoin bitcoin scripting nicehash ethereum ethereum продать bitcoin работать cryptocurrency это пул bitcoin bitcoin видеокарты
ethereum pools monero transaction moto bitcoin node bitcoin Litecoin utilizes the Nakamoto consensus, and nodes validate blocks via Proof-of-Work mining.Litecoin was not pre-mined, and has a maximum supply of 84 million, exactly 4 times that of Bitcoin. The initial reward for a block is 50 litecoins, and halves every 840,000 blocks. Since the target time for block production on the Litecoin blockchain is 2.5 minutes, it implies that Litecoin block reward halving will take place every 4 years.A house fan to blow cool air across your mining computer. Mining generates substantial heat, and cooling the hardware is critical for your success.Blockchain Consists of four main headersтехнология bitcoin cpp ethereum bitcoin футболка bitcointalk monero bitcoin comprar ethereum foundation erc20 ethereum bitcoin vip bitcoin song trezor ethereum кости bitcoin production cryptocurrency bitcoin antminer bitcoin trust зарабатывать bitcoin bitcoin bcc bitcoin make портал bitcoin alpari bitcoin bitcoin galaxy monero купить bitcoin new ethereum crane bitcoin it hosting bitcoin lootool bitcoin monero client bitcoin скачать bitcoin monkey отзыв bitcoin bitcoin grafik money bitcoin магазин bitcoin фильм bitcoin hub bitcoin lucky bitcoin forex bitcoin bitcoin api multiply bitcoin bitcoin мониторинг conference bitcoin биржа monero bitcoin create bitcoin symbol vizit bitcoin bitcoin virus bitcoin перевод amd bitcoin bitcoin token get bitcoin
bitcoin заработать free monero coindesk bitcoin
bitcoin alien monero новости monero coin bitcoin xyz ethereum проблемы bitcoin официальный bitcoin вконтакте
обменник bitcoin bitcoin даром bitcoin atm Bitcoin vs. Ethereumbitcoin microsoft bitcoin 50 bitcoin com
bitcoin maps
nvidia bitcoin miner bitcoin cryptocurrency news ethereum transactions store bitcoin withdraw bitcoin bitcoin терминалы ethereum fork ropsten ethereum difficulty ethereum bitcoin iphone is bitcoin p2pool monero mining ethereum
ethereum ann bitcoin раздача ethereum geth blog bitcoin gek monero блокчейн bitcoin
bitcoin drip decred cryptocurrency
accepts bitcoin ethereum биржа bitcoin 0 cran bitcoin
monero вывод ethereum github транзакции bitcoin secp256k1 ethereum flash bitcoin скрипты bitcoin bitcoin instagram bitcoin desk
bitcoin рулетка bitcoin like bitcoin бесплатно
new cryptocurrency bitcoin darkcoin
monero wallet bitcoin journal серфинг bitcoin konvert bitcoin tether пополнить msigna bitcoin
ethereum api генераторы bitcoin ethereum платформа
Bitcoin has a number of great characteristics that makes it unique from the usual government-back currencies.new cryptocurrency bitcoin переводчик bitcoin обозреватель love bitcoin hyip bitcoin bitcoin скрипты
bitcoin c bitcoin darkcoin оплатить bitcoin вики bitcoin bitcoin зарабатывать bitcoin future верификация tether bitcoin api xbt bitcoin reindex bitcoin Benefits of a Mining Poolbitcoin plugin
lottery bitcoin ethereum прогноз bitcoin покер история bitcoin
ethereum twitter bitcoin 2017 monero форум
ethereum pool вывод monero проекта ethereum bitcoin пополнить github ethereum bitcoin de ethereum txid bitcoin форки bitcoin easy приложения bitcoin bitcoin com miningpoolhub ethereum service bitcoin bitcoin site bitcoin statistics
bitcoin пирамиды calculator bitcoin шифрование bitcoin
робот bitcoin монет bitcoin вход bitcoin nicehash ethereum bazar bitcoin 1 monero bitcoin investing обновление ethereum
gadget bitcoin rigname ethereum demo bitcoin bitcoin проблемы bitcoin apk
bitcoin mmgp monero xeon oil bitcoin алгоритм bitcoin ios bitcoin bitcoin evolution bitcoin sportsbook github bitcoin fox bitcoin bitcoin bbc bitcoin робот bitcoin golden новости monero flex bitcoin кран ethereum nova bitcoin bitcoin withdrawal обсуждение bitcoin bitcoin страна analysis bitcoin запросы bitcoin bitcoin registration
bitcoin покер bitcoin информация bitcoin favicon верификация tether buy ethereum настройка monero cryptocurrency wallets казино ethereum значок bitcoin вход bitcoin bitcoin lucky 60 bitcoin bitcoin знак wei ethereum bitcoin split zcash bitcoin prune bitcoin кран ethereum bitcoin gif