BBC News explains in less than three minutes what the difference is between our current payment system and a system that works with cryptocurrencies.
What is it?
In our current payment system, it’s the bank who gives a final okay for a financial transaction. If you don’t have enough money in your bank account, the bank can stop you buying stuff. For that check, the bank gets paid. If you put your money in cryptocurrencies like the bitcoin the value is recorded on the blockchain, in other words, lots of computers worldwide. If you buy something the record will change on all those computers, which makes cheating impossible. And, better still, it makes it cheaper because no money has to be paid for checking if you’re financially solid.
Why is it interesting?
You hear a lot about bitcoin and other cryptocurrencies, but how do they actually work? What happens? And why are the better or safer than the payment system we use at the moment? With this short video from the BBC, you will understand paying with cryptocurrencies. It is the power of the crowd, in fact, lots of computers, which takes care of safety without the usual costs.
Key take away
“I wouldn’t trust any single person, but I might trust everyone”