Most people are bamboozled by Bitcoin. It’s shrouded in jargon and geek speak. It borrows physical metaphors from all over the place adding to the confusion. It talks of “coins”, but there are no physical coins. You’ll hear about “miners”, although there is no physical digging or drilling. You’ll also hear made-up words such as “blockchain”. People shake their heads in confusion. The Bitcoin community itself doesn’t even know for sure who invented Bitcoin – I even met one of those who claims to be the big founder.
But there are definitions of Bitcoin that even a five-year-old could understand. Bitcoin is an online form of money – each one is currently worth around £290. So, when you read “cryptocurrency”, think digital gold. Think virtual money.
You can buy and sell bitcoins or exchange them for goods and services in the physical world, and a small but growing number of businesses you’ve heard of accept them. What takes place is a wholly digital trade – no physical coins or notes exchange hands. If you want to cash out into physical paper money, you’ll probably have to pay a fee.
From old to new
When you send a dollar