Cryptocurrency vs blockchain - what's the difference?
A cryptocurrency is money that is kept track of on a blockchain.
A blockchain is a system that keeps track of cryptocurrency.
“What makes them so special”?
The real innovation of blockchain is it’s a computer system that pays strangers to maintain it.
Cryptocurrencies are what blockchains use to pay strangers to maintain them.
The reason blockchains are superior is because they’re open platforms anyone can use.
They are open because there is no owner who controls the system.
The way the system can work without an owner is anyone can get paid for helping maintain it.
That’s the genius of blockchain. You have a system that pays for it’s own maintenance!
Since a computer network can’t exactly open a USD bank account, it has to pay in its own made up money.
It turns out the money blockchains use to pay its maintainers is pretty sweet.
It checks a lot of boxes for what people consider ‘good money’.
That’s why people get so crazy over Bitcoin.
To their credit, in 10 years Bitcoin has gone from being worth nothing to nearly $10k USD each.
A made up money paid out by a computer system for helping maintain it. That’s crazy.
But there’s a parallel invention here, not just the money itself, but a system for transacting the money that’s open to everyone.
It gets even more interesting when you realize: what if you can transfer more than just cryptocurrency? USD, stocks, bonds, real estate, custom assets…anything?
That’s why people get so crazy over blockchain.
The possibilities of what you can transfer are endless, but you still need the cryptocurrency to make the system work.
Some people favour the cryptocurrency, some people favour the blockchain.
The truth is they’re inextricably linked together, and they’re both awesome.