What Is Cryptocurrency?
Like a DVD rip of an Atomic Blonde screener, cryptocurrency is a digital asset. Even though it lacks the solid, platinum swagger that made us cower in fear of Charlize Theron's spin-kicks, cryptocurrency has real value, despite a complete lack of any measurable physical qualities.
How Do You Put A Price On A Stream Of Information?
Simple. The value of cryptocurrency comes from it being a manufactured scarcity. The structure of its underlying software limits the total number of units available to the market. Each transaction record is logged as a unique block which encodes the previous block as an irreversible code, known as a cryptographic hash. This unbreakable chain of blocks provides proof of every single exchange that's happened on the currency's network, which allows the ledger to hold true without any centralized authority approving anything. Because of the astronomical amount of computing power needed to break the powerful cryptography to modify the overall transaction history, it's basically impossible to counterfeit. There are no industrious (but lovably scrappy) college students high-fiving in their dorm rooms over their fake Bitcoin machines
Great, But How Does That Make Me Rich?