With this article I want to start a non-technical introduction to crypto. This might be interesting for you if you’re new to crypto or you’re not yet sure what the hype is all about. This is the first part of an intro series into crypto currency topics.

If you are not familiar with the basic technicalities of blockchain technologies and crypto currencies, check out this video:

A quick intro into the world of crypto currencies

Okay, that’s enough of the technologies and concept of bitcoin, crypto currencies and blockchains. Today I want to talk about something bigger — the ideas behind it that make it so powerful. I want to shed light on three basic concepts of blockchains and crypto currencies: Freedom, Transparence and Trustlessness.

Freedom

Crypto currencies are seen as a real threat to the ones in power. The easiest way to exert control over people is through money. You need money for everything — paying rent, buying your food, paying for your health care as well as taxes — and you trade your life time in the form of work for that money. Money works really well as a medium of exchange that we all can agree on (depending on where you are that would be your local currency or the US Dollar).

However the institutions that have full control over monetary policy can create new money out of their arses…ehh, out of thin air. Long story short, printing new money devaluates the existing one — and that makes your hard earned saving be worth less and less year by year.

Crypto currencies however have no central authority to randomly decide that your savings are now worth less. In one way crypto and fiat are very similar: There is nothing that is backing its value. The essential difference is that crypto currencies can’t be randomly issued by one power hungry man. Issuance rate is encoded in the technology itself and only when the community as a whole decides to change those parameters can this change. So the value of crypto currencies is not defined by the few but by an open market. It’s worth whatever the next person is willing to pay for it.

Transparency

Do you have any idea what your bank does with the money you’re depositing there? Or who actually pays your employer, your politicians or law enforcement? No, because it’s all hidden in an intransparent system.

With the blockchain every transaction and every account balance is public by design. While this might sound scary, it’s a good thing. First, your account isn’t necessarily tied to your real identity, so it’s actually pseudo-anonymous. Second, with this every crypto coin is accounted for, actions of companies and important people can be traced and information that is interesting to the public can be made accessible inrevocably. The history of a blockchain can not be changed at will of a few powerful.

This brings a whole new ship of entrepreneurs and entrepreneurship to the world. It lets projects thrive that value transparency, accountability and innovation.

Trustless

There is an endless list of businesses whose account PayPal decided to freeze without an apparent reason. If you’ve never heard of any of those PayPal horror stories, just google it. There have been many occasions of bank runs, because people lost faith in their bank. On the blockchain you don’t have to trust a third party with all your wealth. It’s in your hands to secure your funds. While this comes with great responsibilities it gives you also the full authority over your funds.