Crypto Explained

Crypto is a sort of “digital money”. With this digital money you can pay for goods on the internet, send money to friends, invest in different products or assets, and earn money.

How does this differ from the traditional paper currency like the US Dollar?

Technically, the Dollar is a piece of paper with no inherent value. What gives the Dollar its value is people agreeing to use it as a medium of exchange. With everyone accepting the usage of the Dollar in the US, it is therefore very useful in the US.

Crypto's value is determined by what people think it is worth. The value can be based on: utility- possible uses of the coin, speculation- how much investors will think it will be worth in the future, and many other variables

However, if you go to another country, most people will reject taking your native currency because it is not very useful for them.

Crypto is very similar: it is a medium of exchange that is given value by how useful it appears to be to the masses. In the crypto world, you have coins, or tokens, which represent different currencies. You can exchange one coin for another depending on your needs or as a way to invest.