Dear Mom, This is Cryptocurrency by Zachary Dash

We all have that one family member or friend, that no matter how many times we try to explain cryptocurrency, we are met with blank stares of bewilderment or curious questions of concern.

“Is this real money, or just monopoly money?”

“Okay cool, but what can I do with it?”

“You mean that Bitcoin thing?”

For me, this person is my mother. A red-haired, middle-child and grandmother to three; she always has a way of standing out from the norm and thinking differently. Despite this rebellious nature and open-mind, the conversations of cryptocurrency have been a struggle to say the least.

As with many families across the world, the polarizing topic of Bitcoin has become a common dinner table discussion. Although the average age of cryptocurrency supporters seem to skew towards younger generations, it is not uncommon to have demographics in all directions passionately promoting their side of the debate.

As early adopters, it is not our responsibility to change the minds of others; but rather, foster the growth of understanding. Understanding that of which we do not accept is the first step to accepting that of which we do not understand. So mom, this is for you. This is cryptocurrency.


History of Change

In recent months, I have started to feel like a crypto missionary of sorts. Riding my altcoins into the abyss; knocking on every door who will answer. Telling people you are into cryptocurrency has become the new standard of announcing your vegan-ness or personal crossfit records.  It is many times frustrating to not be met with the same enthusiasm and excitement when discussing something you are so incredibly passionate about. But, can you really blame them?

In 1995, the prominent magazine “Newsweek” published an article criticizing the internet with some pretty confident remarks:

“The truth in no online database will replace your daily newspaper, no CD-ROM can take the place of a competent teacher and no computer network will change the way government works.”

Although this sentiment did not represent everyone’s opinion from the 90’s, the value of the internet was not as obvious as it is today. Google hadn’t been invented yet; your computer still made robot noises when connecting online; and this new technology making its way into our homes was still referred to as the ‘information superhighway’.

As the internet continues to revolutionize how we connect, there is another evolution taking place in the financial industry.


Why Does Cryptocurrency Matter?

It is human nature to explain concepts by answering what something is. In my early conversations, I attempted to explain the concept of cryptocurrency with the same wikipedia-laced line of information:

“A digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank.”

But as humans, we don’t care what something does; we care why it is important. What impact does this have on the world? How does it pertain to me? Although cryptocurrency is still in its early stages, it is already impacting the world as we know it. Here is one my favorite examples of many.

Azraq Refugee Camp

In the heart of a Jordanian desert sits the Azraq Refugee Camp, built for Syrian refugees. While lucky enough to escape the violence and civil war in their homeland, all possessions and goods previously owned have been lost or taken away. Living in conditions and situations many of us cannot fathom, the main sense of normalcy these refugees have involves socializing at a local supermarket. However, instead of paying traditional money, all transactions are utilizing cryptocurrency.

Due to the nature of cryptocurrency, each transaction a refugee makes is locked on an unchangeable digital ledger that can be moved across borders. If there is ever an opportunity to transition back to their home countries, this technology would allow for a smoother transition back into society.

Houman Haddad, the brainchild behind Building Blocks Project added to the importance of how this digital asset will be with them for many years to come. “In the case of refugees, it’s not a document that can be actively taken away from them or something they can be persecuted for stuff on, at the same time they’ll have access wherever they go,”

African Inflation

Although Americans do see inflation of the USD over the years, the problem of over-printing money is a greater and more critical problem in other parts of the world.

“In 2016, a study of 10 African nations with unusual inflationary ratios, indicated that South Sudan had a huge inflation rate of 295%. Egypt had the lowest rate with 12.30%. High inflation and weak African currencies allow Bitcoin and cryptocurrencies to offer African consumers a stable store of value and an inflation hedge.” Source

In traditional financial systems, citizens are dependent on centralized governments and banks to ensure their money holds value over time. In the decentralized systems that cryptocurrency enables, power is put back into the hands of the people.


So, What is Cryptocurrency?

Before we get too far down this rabbit hole, there are three misconceptions that we must clear up.

1) Bitcoin is only a portion of the cryptocurrency industry.

While Bitcoin is inherently a cryptocurrency, not all cryptocurrencies are Bitcoin. Just like in the physical world, there are multiple forms of currency; from the USD and Peso, to the Yen and Euro. Bitcoin just so happens to be the most well-known and media hyped cryptocurrency at this time.

2) Currency takes many different forms.

All the time I hear, “Is this real money?” There are only two things that must be true for something to be used as money. First, two people have to mutually agree it has a value. Second, there has to be something to transfer; like food, paper, or utilities. In the case of cryptocurrency, millions of people mutually agreed it has value, and we transfer ownership to one another as payment. Without this foundation, the idea of digital, cryptographic, “monopoly money” universe is extremely difficult to comprehend.

3) Not all cryptocurrencies are used as currency.

Confusing, I know. If there was one thing I could go back in time and change about the industry, it might be the naming of “crypto-currency”. Although it is possible to use a few coins to buy a cup of coffee, much of the industry is comprised of ‘tokens’ that were made with a sole purpose of performing tasks. Just like hammers, wheels, and the all-important backscratchers; many tokens are used for purpose, not as payment.


How Does Cryptocurrency Work?

Currently, when you want to send money to your uncle in North Dakota, you are probably going to use a third party to accomplish the task. One way you could do this is by transferring some money on PayPal. If you are lucky enough to have the same bank, you might wire him the money. If you are feeling super paranoid, you could even attach some cash to a carrier pigeon and hope he makes it there in time for winter. In all these examples, whether you use Paypal, Chase Bank, or a carrier pigeon, you are putting your trust in another person/entity to successfully transfer your money.

This, is what cryptocurrency changes. There is no middle man but it accomplishes the same task. Although there are many complexities in how this is technically possible, there are only two things you must understand to get your crypto on. Blockchain and Wallets.

1) Blockchain (Bank)

The most common way in which we interact with money in today’s society is through banks. We give our cash and assets over to the bank, and in turn, they promise to keep it safe and easily accessible. While this is an extremely valuable service to provide, the recent innovation of blockchain technology allows for us to get the same safety and accessibility, without using a third-party.

In short, a blockchain is simply a public ledger of transactions. However, instead of one company or entity controlling your funds, the funds are processed and secured by group consensus. Here is a quick analogy to help explain how these transactions are transmitted.

Imagine a room of 10 people; all with an imaginary $10. Everyone knows the rules of this room and how much money everyone else has. When Person A wants to send their imaginary money to Person B, they simply say it out loud. “I, Person A, am sending $5 to Person B”. The entire room hears what just happened and writes it down. When Person C wants to send money to Person D, they follow this same process. Announce their transaction, and everyone writes it down. At any time, we can ask the room how much money any person has, and the room, as a whole should be able to tell you the correct amount. There is no teacher in the middle. There is no principal in the lobby. Everyone has an equal voice and relies on the trust of the group to come to a consensus of what is right.

This is how cryptocurrency works. But instead of trusting in people to write everything down on paper to keep up with these transactions, we put our trust in math.  While it seems like a crazy idea to put our trust in mathematical numbers and formulas, this is something we already do on a daily basis without knowing it. When we set our alarm clock at night, we are trusting in math to wake us up at the right time. When we navigate our way to the top of a skyscraper, we are trusting in the math of architects and engineers to ensure our safety. When we are driving our cars, we are trusting in math to tell us how fast we are going and how much gas we have left in the tank.

I believe a lot of people get scared away from the industry when they first hear the word ‘crypto’. Seems like some made up word from the Da Vinci Code or Legends of the Lost Temple. However, if we simply think of ‘crypto’ as mathematical formulas, it is sometimes easier to comprehend.  While humans have done many amazing things throughout history, we have also proven to be emotional creatures that make mistakes. Cryptocurrency builds itself on the trust, consistency, and the incorruptible nature of numbers.

2) Wallet (Bank Account)

Now that we understand the blockchain can be used as a decentralized bank, we can move on to understanding ‘wallets’. The best analogy when describing a cryptocurrency wallet is similar thinking of your current bank account. This is where you send, receive, and keep your cryptocurrencies. While many people like to imagine their money sitting safely three stories underground in a vault protected by armed guards, most banks now hold a majority of their assets on central computers and servers. If these servers or vaults were to be robbed, your money would be in jeopardy as well.

Cryptocurrency assets, however, sit inside multiple digital ‘vaults’ all over the world. If a hacker or thief were to try and steal your money, it would take much more time, energy and effort to do so. With no central target of attack and a security system that gets stronger as the network grows, cryptocurrency wallets are a decentralized solution to the current banking system.

Here are the five ways in which you can currently store and send your cryptocurrencies in a decentralized manner:

  • Web Based Wallet: A virtual web based wallet is similar to how you currently interact with your bank online. You go to a web page, login, and can access your account.
  • Desktop Wallet: To use this, you must first download a software (similar to downloading iTunes or Photoshop). This is a great alternative to taking the coins into your own hands.
  • Mobile Wallet: Same concept as a desktop wallet, but on your phone. Simply download the mobile app from the app store and you are good to go.
  • Hardware Wallet: These wallets usually come looking like a USB stick, with some extra added tech inside. It seems counterintuitive to move a digital asset onto a physical wallet, but this is one of the safest way to secure your coins.
  • Paper Wallet: Your wallet always has a public and private key. Think of this as your account name and password. A paper wallet allows you to print this information off and take your coins “offline”.

Even as a cryptocurrency advocate, many people believe wallets are currently the largest obstacle holding back the mass adoption of cryptocurrency. While you don’t need technical understanding of the blockchain to gain its benefits, there is still a very high learning curve for sending, receiving and storing cryptocurrencies. It’s like we have baked the best cake in the world, and nobody knows how to use a fork, yet.

Currently, many different coins and tokens require their own wallet or storage system. To counter this, the team at Ethos is building out an easy-to-use mobile application to interact with cryptocurrency without all the confusing stuff. With the Universal Wallet, Ethos puts you in complete control at all times with no need to keep track of multiple wallets and private keys. You can rest easy knowing your assets are safe, secure and right there when you need them. Here is a sneak peek at the mobile app coming soon:


How Does this Affect Me?

Alright, so you have a basic understanding of cryptocurrency, but how does this pertain to you? What are the actual use cases and how can this make your life better?

More Secure

Decentralized platforms over time will be a much more secure network, but why is this? In the past year, there have been many stories of large and credible companies getting hacked.

  • Equifax, a top consumer reporting agency, had over 145M customers’ data and information compromised. [Source]
  • Target, one of the largest retailers, had credit card and debit card data from over 40M accounts stolen. [Source]
  • Uber, the largest ride sharing application, had data from over 57M customers stolen. Oh, and they paid $100,000 to cover it up. [Source]

More than individual entities showing an inability to remain secure, there have been countless examples of entire countries taking advantage of their power. Most recently, the United States experienced the 2008 financial crisis which is considered by many to be the worst financial downturn since the Great Depression. Here is a quick summary of how and why it happened.

  • People wanted to keep their money safe, so they put it in banks.
  • Banks wanted to make money, so they took people’s money and gave it out as loans.
  • These loans were not good loans, and people did not pay them back.
  • The banks declared for bankruptcy and the government stepped in to bail them out.
  • The Government used the people’s tax money to pay off the money that the banks lost.

When there is one point of failure it is easy for negligent, malicious or simply corrupt behavior. Cryptocurrencies on the other hand are not stored in one central location, but on a distributed, decentralized system.

Lower Fees

While Bitcoin has had some growing pains of the last few years with transfer fees, there are many other cryptocurrencies that allow you to send with minimal or zero fees.


You can take cryptocurrency with you anywhere in the world and it retains it’s value. No need to convert it to the local currency. Although there a limited number of vendors who currently accept cryptocurrency, this number is expected to grow exponentially in the very near future.


Some coins offer more anonymity than others. Not sure what you want to be buying with this anonymous money mom, but I will leave that up to you.


This is where we currently are with cryptocurrency; a mystical state of science fiction and awkward teen years. Not quite old enough to drive, but just tall enough to ride every roller coaster at the amusement park. As we try to figure out where this all will end up in our society, cryptocurrency is trying to understand itself and the long term impact it will have on the world.