Light high level introduction to cryptocurrency

1. Digital Money
An Introduction
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2. Why do we use Currency/Money?
 Medium of Exchange:
Accepted by all (in the past - -
- gold, silver, salt, furs, beads, shells)
 Store of Value: Allows
purchasing power to be
saved
 Measure of Value: Express
Worth of an item.
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3. What is Digital Money?
also known as Cryptocurrency
 Digital Money uses cryptography to secure and verify
transactions as well as to control the creation of new
units of a particular type of money / cryptocurrency.
 Cryptocurrencies are limited entries in a accounting
ledger that no one can add activity to unless specific
conditions are fulfilled.
 Blockchain is almost exclusively the technology used to
keep the internet based ledger of activity stored. This
allows all to track, move, store and protect the money.
 Therefore a cryptocurrency is a digital or virtual currency
designed to work as money.
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4. Blockchain Simplified
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Tom has $10
Tom pays Paul $10
Paul pays Joe $10
Each transaction is
stored separately
and is called a block
Each block is kept in
sequence to prove
that Tom had
money to give Paul
and Paul had
money to give Joe
Copies exist all over the network
(thousands, even hundreds of
thousands). All those who keep
these copies, verify each new
transaction. When most agree the
transaction is valid, it is assumed
correct and added to the chain.
This is also known as a
distributed ledger
http://www.ey.com/Publication/vwLUAssets/ey-overview-of-blockchain-for-energy-and-commodity-trading/$FILE/ey-overview-of-blockchain-for-energy-and-commodity-trading.pdf
Principals
o Shared
Ledger
o Consensus
o Immutable
o Smart
Contract

5. What is Money we use today?
Also known as FIAT Money
 Today’s currencies that are issued by countries is termed FIAT currency
 FIAT is a currency without intrinsic value that has been established as money
and maintained often by government regulation. It has value only because
a government maintains its value, or because parties engaging in exchange
agree on its value.
 FIAT money replaced Commodity & Representative money (e.g. gold
standard, silver standard).
 Electronic uses of FIAT money (e.g. debit and credit cards, automated bank
payments, etc) are often used, as opposed to the physical paper.
 Electronically accessed FIAT money is different from Digital Money which is
created by an independent group, and valued by its participants (e.g.
Bitcoin)
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https://en.wikipedia.org/wiki/Fiat_money

6. Cryptocurrency vs FIAT Currency
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7. HOW MANY ARE USING CRYPTOCURRENCY
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8. TODAY THERE ARE OVER 2000 CYPTOCURRENCIES
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https://www.fool.com/investing/2018/03/16/how-many-cryptocurrencies-are-there.aspx

9. Digital Money and Digital Assets
The term of Cryptocurrency has numerous different types
 Trade – Like the original, Bitcoin, it is used to buy/sell via
the use of this currency. No underlying asset value. It
value floats on supply/demand & social media drivers.
 Ownership – (aka Security) Coins/Tokens representing
ownership in an organization
 Rewards – Coins/Tokens issued as a value add (like
airline miles) – no underlying value
 Asset Backed
◦ Commodity –an asset (e.g. gold, dollars, coffee, etc)
◦ Utility token – a service or product
◦ Stable Coins – An asset-backed currency that has
low to near zero price volatility.
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Note: Many
Crypto
currencies are
of specific use
and are often
called Tokens
to define their
different
purpose.
Security
tokens are the
best example
of the use of
this term.

10. In Conclusion
 Cryptocurrency is here to stay.
It is in an evolutional process. The internet of today is nothing like its
original creation, Apranet; which was a text base communication
protocol between universities
 Cryptocurrency is real
The values do translate into real assets and a regularly exchanged
and traded against major world currencies
 Cryptocurrency is a major disruptor to world economy.
For the first time individuals can work directly with each other
(purchases, investments, trading) without the need of an third party
(e.g. banks, brokers). This change in how we move value will modify
how ownership, identity and buy/sell functions will operate.
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