Plain and simple crytocurreny is a digital currency. We will start there. Bitcoin being the most well "known".
Bitcoin was created by an anonymous programmer going by the name of Satoshi Nakamoto. Nakamoto posted a letter to on a popular cryptography blog proposing a system to change digital currency. The solution would solve the problems that digital currency has faced in the past.
One problem with digital currency is the double spending problem. This is when the digital currency is spent twice. This is made possible because the holder of that digital currency duplicates or falsifies the digital file of the online currency. Making it where they can purchase services or goods from multiple "vendors" with the same piece of digital currency.
Among the problems with digital currency, there are also problems with banking and credit cards that Nakamoto sought to fix with his proposal.
Banks and credit cards company take a share of the money, whether it's banking fees, interest or annual card fees. There are also many security issues with banks and credit cards.
The way that Nakamoto proposed these problems could be fixed or avoided was instead of a bank or credit card company recording every transaction in one system ledger, was for all of the users to record the transaction at the same time. This way any attempt to fool the community would be noticed and rejected.
Bitcoin is easy to spend money between borders and is also accepted by some retailers.
Among some of the vendors that accept Bitcoin are....
- Overstock.com
- Expedia
- Newegg
- Dish Network
- Wordpress.com
- 93 different Etsy vendors
- Steam
- And many more!
