July 7

Entering the World of Cryptocurrency and Unpacking the Hype

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The world of cryptocurrency moves fast, and it can be hard to keep up sometimes. But the fundamentals of the technology have largely remained the same—besides the explosion of interest in it. Here’s what you need to know about cryptocurrency today:

Many people, including governments, see crypto as the future of money

The history of money is a fascinating and complicated topic, but the basics are that we used to use gold and silver as a backing or means of currency. 

Today, at least in the United States, we haven’t done that since the 1970s. The value of fiat currency lies in the system or government that regulates it. 

Cryptocurrency is a decentralized network of value, meaning that there is no one single entity like a government that controls it. 

You might think that governments and central banks would see this as a threat, but countries like El Salvador—which just designated Bitcoin as legal tender in its country—are actually embracing crypto. 

Not only is crypto decentralized, but it’s also global. As the world becomes more and more interconnected with the development of Web3, this can be more of a benefit than a detriment for both countries and individual people.

Cryptocurrency relies on proof of transaction versus trust in the system

As Abel Miranda said on episode 20 of the Blockchain Life podcast, “With Bitcoin, you trust the code, you don’t trust the people.” The blockchain systems that host cryptocurrencies are records of transactions or “proof” that currency has changed hands. 

This is totally different from our current system, which relies on our collective trust in that system and in each other to operate. 

The cryptographic proof that is housed in blockchain offers greater transparency and potentially greater security to the global exchange of currency and value.

When cryptocurrency changes hands, you don’t have to trust the hands it came from or the hands it’s going to—all the proof is in the blockchain.

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Cryptocurrency is becoming more integrated into the everyday exchange of value

If you were around in the 1990s and early 2000s, you might remember the Beanie Baby craze. These children’s toys became suddenly valuable, seemingly overnight, when a bunch of people decided they were valuable. 

The problem with that, as Abel told us, is that “you can’t go to Starbucks and buy a cup of coffee with a Beanie Baby” and today, those little stuffed animals are predictably worthless. 

But is that going to happen to Bitcoin and crypto? Probably not, because more states, localities, and even countries are implementing ways to pay for goods and services with cryptocurrency. 

You can buy a cup of coffee with Bitcoin in several places. And the more these trends progress and crypto becomes more integrated into the everyday exchange of value, the more important it’s going to be to know what’s going on, how to leverage your opportunities with crypto, and how to be smart about it. 

You can keep up with the latest on blockchain, crypto, NFTs, and everything Web3 on the Blockchain Life podcast. Listen to Abel’s episode here, and subscribe for new episodes weekly.

Join us at the 2022 Igniting Souls Conference. We’ll teach you how to leverage Web3 for your book, brand, and business. Limited tickets available. 


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