You know that one friend that’s into really niche, experimental bands and stops listening to them when they become too popular? Well, that’s a pretty accurate analogy for the fourteen-year history of cryptocurrency. Bitcoin, the first ever cryptocurrency, has been an especially hot topic of conversation among stock market investors and tech bros alike. Even if you don’t totally understand crypto, you’ve probably heard someone’s opinion on it. 

There’s a theory in investment called the shoeshine boy theory, which asserts that when an asset becomes so mainstream that virtually anyone can give you advice on how to invest in it, you should pull out. The theory is often applied to Bitcoin, but we used the music analogy instead because, well, we all have that friend. 

On a serious note, we really do believe crypto is worth learning about, and not just so you can nod at the right times when someone’s talking about it. Like almost all of the finance world, crypto is a pretty male-dominated space. It can also be very complicated for newbies. Maybe this is intentional, keeping the profits for a small club of enthusiasts—or maybe we’ve just watched too many conspiracy docs. Either way, since Bitcoin first skyrocketed in value in 2017, many people have made huge profits from it (and from cryptocurrency in general).

So where do we start? The beginning, of course. 

What is crypto?

Cryptocurrency refers to currencies that aren’t controlled by governments and banks, which are known as “central authorities.” Cryptocurrencies are tradable assets (i.e. you can exchange them on trading platforms to try to make a profit). They’re created, bought and sold online. Cryptocurrency is secured by a type of computer science called cryptography - a secure communication system that transforms messages in a way that’s almost impossible to decipher - making them very difficult to hack. Pretty cool, hey? 

In comparison to crypto, dollars, pounds, and yen, for example, are known as fiat currencies—traditional, government-issued currencies that aren’t backed by a physical asset (such as gold). Back in the day, and for over a century, the US Dollar was backed by gold in a system known as the Gold Standard. It meant that for every dollar, there was an equivalent, physical reserve in gold. But this all changed in 1963, giving us the system we have today. Unlike cryptocurrencies, fiat currencies can be physically withdrawn in cash. 

Bitcoin was the first ever cryptocurrency, created in the wake of the 2008 financial crisis. A person (or group) known as Satoshi Nakamoto is its original creator, but little is known about their true identity. It’s a Netflix documentary in the making, right? 

Bitcoin doesn’t exist physically (i.e. you can’t hold a Bitcoin in your purse), and it can only be traded online. Bitcoin transactions are managed by a group of people known as Bitcoin miners. Rather than digging the depths of the Earth, Bitcoin miners use incredibly powerful computers (which use more power than what’s required to power some countries) to solve complex, coded, mathematical equations and verify transactions in real time. It’s a confusing concept to wrap your head around—and this is a surface-level explanation of it—but if you want to know more, you can read about it here. 

Bitcoin was originally created to help people transfer money around the world securely, anonymously, and without bank-imposed charges. Unsurprisingly, this was attractive for criminals, which is part of why Bitcoin’s reputation is so shady. 

Bitcoin transactions, like all crypto transactions, are stored on an online ledger (a list of historic transactions) known as Blockchain. Its potential to democratize more than just money is massive. Blockchain could change our approach to tracking supply chains, art dealing, charity donations, and more.

Okay, and what’s an NFT?

Not all cryptocurrencies are designed to be used as money in the way we understand it. Think about coupons for Walmart or coins you get in Mario Kart—these currencies can only be used within their specific settings. That’s similar to how some crypto tokens operate. An NFT (non-fungible token) is unique, which means it can’t be interchanged or replaced with another identical token. Bitcoins, dollars, and pounds are all fungible—you can exchange a $1 note for another $1 note, but you couldn't exchange a Pokemon card for a Van Gogh painting because these are non-fungible assets. An NFT is a digital version of a non-fungible asset.

The fun part? Anything can be made into an NFT. Anything. A Pokemon card, a Van Gogh painting, or even a meme.

Are NFTs a fad? It’s hard to say. The value of NFTs is questionable, because if an original asset already exists online (like a meme), anyone can access and download the same image without paying hundreds of millions of dollars for it. 

Why should I care about crypto then?

The cryptocurrency space is less than twenty years old, but it’s already dominated by those in control of the traditional financial industry. Still, there’s a chance to get in and change its course. Knowledge is power and the more informed you can get, the higher chance you have of not being excluded from the industry by the time it hits the mainstream and becomes “too commercial.”

It’s important to remember that crypto isn’t guaranteed to make you money. It’s an incredibly volatile asset and while many have profited from trading it, others have lost even more. Cryptocurrency is known for changing dramatically in value within a matter of seconds.

Since Bitcoin’s inception, thousands of currencies have popped up via 30 blockchains. One of the most popular of these blockchains is Ethereum, which was created by a 19-year-old boy genius. Of course. What makes the Ethereum blockchain special is that you can build any application on it—from VR games to crowdfunding platforms to systems for tracking precious gem mining. The Bitcoin blockchain, in comparison, can be used only for a single function: money exchange. Boring.

Businesses have used the Ethereum blockchain to build many different tools: secure and accurate music-royalty tracking, secure voting, anti-money-laundering, agricultural supply-chain tracking, and more. It’s extremely versatile and has a huge potential to support the future of tech; the Ethereum blockchain is very secure, and it’s “virtually impossible for any third party to interfere.” With that said, still be cautious—the applications built on Ethereum are only as secure as individual developers have made them. 

While individual coins and tokens may be fads, the tech that supports them isn’t. And this means that there isn’t just money to be made, but opportunities to leverage the tech to change the world.

Cool. So where do I start?

Getting started with crypto can be intimidating. Here are some resources that can help you understand the space a bit better, and some of the biggest trading platforms to look into.

• The Motley Fool is great for breaking down some of the more complex parts of crypto into plain, simple English.

• Coinbase is one of the biggest, most trusted exchange platforms. They also have a great education hub.

• If you just want to dabble in crypto, Revolut gives you the option to do this on top of your regular fiat currency accounts.

• Binance is a good app if you’re interested in investing in Altcoins, which basically refers to currencies that aren’t Bitcoin.

• eToro is good if you want to keep all your investments (crypto and non-crypto) in one place.