What Is Crypto, Anyway? Opa Explains Bitcoin, Tokens, and the Digital Gold Rush

What Is Crypto? Opa Breaks It Down (Gently)?

Now listen here — if someone told me twenty years ago that one day I’d be buying invisible money on the internet and calling it “crypto,” I would have thought they had gotten into some bad “shine,” and they were still recovering from an explosive hangover. But here we are today … it’s now, not back then.

So what is cryptocurrency? Because I’m no expert, I’ll keep it simple.

Crypto Is… a Kind of Digital Money

It’s like regular money — only there’s no paper, no coins, and no banks holding it. Instead, it’s all online, and it runs on something (they) call blockchain technology. Don’t run away yet!!!

Just think of blockchain as a big, ol’ digital ledger book that everybody is allowed to look at any time, but nobody is allowed to tinker with or erase.

To put it differently, I know all that I need to know or want to know about blockchain. I just think of it as a big, community piggy bank that keeps track of everything and is open to everybody — but at the same time, it’s locked up tighter than Granny’s cookie jar at Christmas time.

Why Is Crypto Such a Big Deal?

Good question. Crypto is what the younger folks would call a disrupter. It is shaking up the world of money. Here’s why:

• NO MIDDLEMAN: You don’t need to go to a bank to send money to a family member or friend anywhere in the world.

• IT’S GLOBAL: One Bitcoin is worth the same (“one Bitcoin”) whether you’re in Boise or Bangkok.

• IT’S LIMITED: Bitcoin is like digital gold, except they’re still mining gold, but there are only 21 million Bitcoins! Period!! Forever!!! Its relative scarcity means that long-term value is built in.

• IT’S PRIVATE, BUT PUBLIC: It’s private in that your name is NOT on your account. But it’s public in that everyone in the world who cares to see them can see every transaction everywhere. No sneaky secrets looming in darkness hoping that nobody will ever DOGE them.

• IT’S FAST (USUALLY): Some crypto can move money in seconds instead of days. My bank that only gave me $.21 last year on my savings account of just over $2,400 (that’s something like .01% APR) takes three days to move $100 from their bank to my other bank a couple of miles away—but even though I can’t use my money during those three days, they don’t stop collecting interest for themselves on it. (That would be a felony if they weren’t a bank.)

So yeah — it’s a little weird. It’s a little wild. But it’s changing how folks (young and old) are beginning to think about money. And for some of us older folks, it’s also one last chance to get in on something really big, even if you still prefer to write paper checks at the grocery store.

What’s the Difference Between a Coin and a Token?

Ah, this is where we get a little technical. But don’t worry — we’re simple people so we have simple explanations:

• COINS are the original money on a blockchain. Think Bitcoin or Ethereum. If the blockchain is the highway, then the coin is the car driving on the highway.

• TOKENS are built on top of another blockchain (usually Ethereum). So to me, they’re like passengers riding in someone’s car. Tokens can be used for all kinds of things — playing video games, on apps, or even buying concert tickets. But tokens are not a highway (blockchain) or a car (coin).

And so, while a technical expert would “take apart” what I just said, it doesn’t matter to me. I wasn’t trying to analyze it. I’m just trying to understand it — and that’s what I shared with you. So think:

• Coin = is its own thing.

• Token = rides on someone else’s thing.

Final Thoughts from Opa’s Front Porch

Look, this is the best I can do. I never claimed to be anything but other than a curious, old man (well into my 70’s) going on one, last HOO-RAH before I take my final rest. I’ve been poking around in an amazing, big, digital garden that I happened to stumble on recently (after being hammered by my bank again)—and sharing what I’m learning as I’m learning it.

When I told Dex (my son) about it, he was so happy that I had finally found it. I love this guy — not only is he my son and best of friends, but he’s also a genuinely good guy. Nevertheless, I’m not going to do what he did. I’m an evangelizer at heart! I’m telling the world (around me) about Bitcoin and crypto and all the other good stuff that I still don’t know yet — but am learning about daily. And so, here’s what I’ve learned (and Dex really did steer me in the right direction):

• Crypto isn’t just for techies or millionaires. It’s actually a brand new way to think about value, ownership, and how we use money.

• Crypto might be the future or maybe it’s just a fad. But one thing’s really clear to me — you don’t want to miss the chance to learn about crypto, laugh a little, and maybe even dip a toe or two into the water. It’s really easy to do!

P.S. If you want to know a secret, the best place to start with crypto is Bitcoin. If you get it right with Bitcoin, you might not even want to tinker or tamper with anything else in the cryptocurrency world.

Our Story

That’s our story, and we’re stickin’ to it. Have you started writing your own crypto story yet?