Digital Currency: Explain that cryptocurrency is a form of digital or virtual currency. Unlike traditional currencies issued by governments (fiat currencies), cryptocurrencies exist only in electronic form.
Decentralized Ledger: Introduce the concept of blockchain, which is a decentralized and distributed ledger. This means that instead of a central authority (like a bank), the information about transactions is spread across a network of computers.
Digital Wallets: Introduce the concept of digital wallets, which are software programs that store cryptocurrencies. Wallets allow users to send, receive, and manage their cryptocurrency holdings. Some of the more popular wallets include Metamask and Coinbase wallets.
Price Fluctuations: Mention that cryptocurrency prices can be highly volatile, with values changing rapidly. This is different from traditional currencies, which are generally more stable.
Transactions: Explain that cryptocurrencies can be used for various transactions, both online and, in some cases, in physical stores.
Smart Contracts: Briefly mention smart contracts, which are self-executing contracts with the terms directly written into code.
Investment: Acknowledge that some people invest in cryptocurrencies, but it comes with risks. Prices can be unpredictable, and there’s the potential for loss.
Cryptocurrency can be an intimidating subject to most. However, as the individual’s learning curve increases the level of fear drastically decreases when it comes to cryptocurrency. Remember to gauge the individual’s level of interest and understanding as you explain, and be patient in addressing any questions they may have.
