John Oliver Hilariously Breaks Down Cryptocurrency In A Way Anyone Can Understand
John Oliver, the host of HBO’s Last Week Tonight with John Oliver, just did your grandma a solid by breaking down a complicated concept like cryptocurrency so it’s easier to understand. Not only does he explain the concept, with the help of a couple of friends, he makes you laugh while he’s doing it and by the time he’s done, you really can explain bitcoin to anyone.
Cryptocurrency is a currency that only exists digitally and isn’t regulated by any bank. An example you’re sure to have heard of is bitcoin, although there are about 1,500 cryptocurrencies now in the marketplace.
The reason bitcoin and other cryptocurrencies are treated as currency is that it is perceived to store value and is often used in online transactions. Everyone accepts that the U.S. dollar bill has value; therefore, merchants and other people accept the dollar as a unit of money to be exchanged for goods and services. The same holds true for bitcoin or any other cryptocurrency. What makes cryptocurrency special is that it’s not regulated by the banking industry. In fact, it’s not regulated at all.
You might be wondering how cryptocurrencies are accounted for if there’s no regulation to track its movement. There is a ledger of transactions on all movement of cryptocurrencies; however, and it exists in a blockchain.
A blockchain is a crowd-managed record of cryptocurrency movements — who bought what and when. Since the information isn’t stored in one central area (like a bank) the information is virtually unhackable. This safety factor is a huge draw to dealing in cryptocurrencies as an investor and blockchains are also something that retailers are looking into to store their information (and yours) to keep it safe in an increasingly digital world.
Investor interest in cryptocurrencies is on the rise, and there are many people who’ve made a lot of money on bitcoin in particular. Still, trading in cryptocurrencies is a huge risk.
Right now people accept that bitcoin has value, but that doesn’t mean they will tomorrow. Putting money into such a risky investment is a gamble just like any other on the stock or currency exchange, so never invest any more than you’re prepared to lose. That rule of thumb is not only true for currency investments, but any investments at all.
Now let’s watch John Oliver break it down below:
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