Despite the evangelising by and rising profile of some investors, a 2021 poll by Pew Research Center found that just 16% of Americans said they have ever invested in cryptocurrencies. That broadened to 31% between the ages of 18 and 29 and to 43% of men in that age range.
Blockchains also can be used to record other types of information – like property records or the origins of a food item.Fundamentally, cryptocurrencies are digital money. The blockchain is a database for recording transactions of said digital money. This digital money isn’t backed by any government or institution.Different cryptocurrencies have different digital architectures so how they work varies. As an example, let’s use bitcoin, which is “mined”.
As a kind of check, the system is also designed to increase the difficulty of solving the mathematical puzzle as more computers compete to do so. At the same time, the amount of bitcoin successful miners win decreases automatically at predetermined intervals. Together that means entities that got into mining quite early made out with more bitcoin in return for spending fewer resources.
Cryptocurrency exchanges – where people can trade cryptocurrencies for traditional currencies – have been compromised multiple times, with digital bank robbers clearing out the accounts. Memorably, in 2018, the CEO of a cryptocurrency exchange died without relaying a crucial passcode, effectively locking customers out of millions of dollars’ worth of cryptocurrencies.