What is Cryptocurrency and how does it work?

Oh my goodness! I've been knee-deep in this world for months and I still find it hard to explain it to my grandmother. Let's see if I can tell you what this digital madness really is without putting you to sleep.

🔸 Cryptocurrency: the money of the future or the biggest bubble in history?

Cryptocurrency is basically virtual money that exists only on the internet. There are no bills you can touch, nor coins that might fall out of the sofa. It's all computer code protected by extremely complicated mathematics so that no one can counterfeit it. The most interesting ( or dangerous, depending on who you ask ) is that it works without banks or governments getting in the way.

🔸 How the hell does this work?

Imagine a giant ledger book where we can all see all the transactions, but no one can delete or manipulate it. That is the "blockchain." When I send cryptos to my cousin, that operation is recorded forever and verified by thousands of computers at the same time.

Coins are created by "mining" them - which sounds romantic but in reality are extremely powerful computers solving impossible mathematical problems and consuming electricity as if there were no tomorrow. I tried mining once and almost set my apartment on fire due to the computer overheating.

You have nothing physical. Just a private key (password) that allows you to move your virtual coins. And if you lose it... well, say goodbye to your money. Forever. No chance to call customer service. There is no customer service.

🔸 The "stars" of the crypto-universe

There are thousands of these coins. Most are worth not even the code they are programmed with, but some have made millionaires out of many ( and ruined just as many ):

● Bitcoin:

The grandmother of all cryptos. Created by someone named Satoshi, who the hell knows who that is. It could be a person, a group, or even a government. It has gone from being worth cents to over €100,000. Those who bought pizza with bitcoins in 2010 now cry every night remembering they paid the equivalent of millions for a margarita.

● Ethereum:

The class list. It's not just digital money; it also allows for the creation of smart contracts and decentralized applications. Its creator, Vitalik Buterin, seems like a child prodigy out of a science fiction movie.

● Litecoin:

It's like Bitcoin but faster. It's like comparing a Seat to a Ferrari, even though both take you to the same place.

● Ripple:

The group's "sellout." Works with the same banks that cryptocurrencies supposedly wanted to eliminate. Pure irony.

The others are "altcoins", as we call the rest of the thousands of projects that emerge every day promising to revolutionize the world and that mostly end up being worth nothing.

And remember, no matter what the crypto influencers say on social media: this is a casino disguised as a financial revolution. You can get rich or lose it all in seconds. I have experienced both feelings... sometimes on the same day.

BTC: 119,870.19 +1.06% ETH: 4455.19 +1.53% XRP: 3.0468 +2.02%