Coming up with crypto
Lesson in Course: Crypto (advanced, 2min)
How does cryptocurrency work and why was it created that way?
What it's about: We can better understand how crypto works by walking through how and why we might invent our own version of it.
Why it's important: Insights into the direction crypto is headed are clearer when we have a deeper understanding of how it all works.
Key takeaway: Crypto and blockchain's usefulness goes far beyond Bitcoin and speculating.
To get a deeper understanding of how cryptocurrency works, this video walks through how we might invent our own version of Bitcoin!
Starting with how we'd keep track of payments between friends on a communal ledger, it shows how principles from cryptography circumvent the need for trust. This is what eventually leads to the development of cryptocurrency.
Actionable ideas
While a deep dive like this isn't necessary to own or use cryptocurrency, you should understand what crypto is and how to think about it without assuming its usefulness is tied to the price of Bitcoin.
Supplementary materials
This article goes even deeper into the technical aspects of blockchains:
https://michaelnielsen.org/ddi/how-the-bitcoin-protocol-actually-works/