Bitcoin Q&A: Explain Bitcoin to my mother?

Amber asks, “Could you explain Bitcoin to my mum?
I ask because I want this video to exist for my mum… and everyone like her, who wants
to understand the basics.” All right. Whether it is your mum, dad, grandpa, kid,
nephew, niece, or even your grandchild, and you need to explain Bitcoin or any cryptocurrency
to somebody who is not technical… Let’s see if I can do a good job of this. What is Bitcoin and what are cryptocurrencies? Bitcoin and cryptocurrencies are a form of money
invented recently and introduced on the internet. This is a form of money that
only exists in a digital form. It can be sent and received just like an email. The advantage of that is, in many countries, people have
very limited access to traditional financial institutions. But even in developed countries, traditional
financial instruments like credit cards, checks, and paper money are not
suitable for our digital lifestyle. It’s actually very difficult to use financial
systems that were designed in the 1950s, like credit cards, online to do e-commerce. A lot of people suffer from identity theft,
chargebacks, stolen credit cards, and overcharging from vendors once
they’ve given [credit card information]. All of these are problems and bureaucratic
issues with traditional financial payments. One of the advantages of having a new digital
currency that lives on the internet… and operates entirely in digital form, is that it is
much more suited to our modern digital lifestyle. Making payments online [with bitcoin] is a lot safer,
it’s faster, and in many cases it is cheaper. When you make a payment with a credit card,
you may not see the level of fees that is being charged. That gets charged to the merchant, not you. But inevitably, because of market economics,
someone is going to pay for that fee. The merchants are going to pass that on to
you in the form of higher prices. Another advantage of using this new digital
form of money, is that you can save more… because the fees are lower for you and the merchant. It’s more secure. There’s less opportunity for
chargebacks and fraud. You risk your identity less. All of these things reduce the cost
of engaging in commerce online. Your first experience with these digital currencies
is not going to be as simple as you imagine. Remember back in the days, when you tried
to do some online shopping for the first time? Or maybe the first time you tried to connect
to the internet and send an email? Perhaps you struggled with modems, setting
up a connection with an ISP, a clunky desktop, trying to install a Windows machine or a browser
that was confusing and weird. Gradually, over time, a lot of these
rough edges were smoothed out. Nowadays, you can buy a device that is
very easy to interact with, such as a tablet. It already comes pre-installed with
everything you need to use the internet. You can easily connect to a WiFi hotspot. You don’t need to sign up for
an account with almost anyone. Sending emails and doing online shopping is easy. Well, digital currencies are still in the early stages. As a result, the software is pretty clunky,
the services are in their very first iteration, and the companies haven’t yet
developed easy ways to use them. Maybe digital currencies like bitcoin and other
cryptocurrencies are not quite right for you yet. But in places where people are desperate for financial
services, where they have access to nothing… other than cash, and they’re surrounded by
corrupt governments, officials, cops, and banks… The effort to learn and use
this technology is well worth it. It can be a really meaningful change
in their life circumstances. For most Westerners, this is still more of a curiosity.
It’s more of an interesting technology [than a currency]. If you’re a geek or fascinated by new technology,
maybe you will put in the effort to learn about it. In any case, it might be interesting to
experience one of these transactions. But don’t let this early stage technology fool you. Just because it is clunky now
doesn’t mean it will be clunky forever. The fundamental principles and structure of these
new digital currencies, the open world they create, where money can be transmitted
and commerce engaged in, where people can hold on to their assets securely
anywhere in the world and transact with anyone else nearly instantaneously, securely, with very low fees… That is really going to change the world. You can either jump on that bandwagon now, go through
some of the early pain of trying out a new technology, or just be aware that this thing is
happening and wait a few years. Eventually, it is going to be easy to use for everyone. Then we’ll have to try and explain to our children
and descendants what the hell we were thinking with these plastic cards, this linseed and
cotton money that was covered in germs. They will not understand what we’re talking about.

81 thoughts on “Bitcoin Q&A: Explain Bitcoin to my mother?”

  1. Andreas you just kept it still technical for no-tech people. Would be better to explain with the distributed ledger, which principle could be understood by most people. That would not be possible outside of the digital world reliably, and this is the purpose of the entire crypto-space. 🙂

  2. I've put a like but I'm not sure actually it's the answer that the person was waiting for: "Explain Bitcoin to my mom" (i.e how it works) is not "give the advantages of Bitcoin to my mom".
    Because the true challenge is not to explain the advantages (even if in details it surely can be more complicated) but how it works, what it is.

  3. Is it just me or every time you watch ANY of Mr. Antonopolis' videos it takes you to a higher place….Kind of like that feeling you get when you feel really good and get goosebumps!?

  4. The one problem I see, the one paradigm shift that needs to happen is responsibility.

    Some people have problems with the idea of no protection by an institution. That once you send a payment, it can only be recovered if the recipient is willing to refund.

    I see it as a plus, but many people have problems understanding that they are the bank.

  5. I think you should also explain private keys, public keys, bitcoin addresses and mining. I use to explain mining saying that a made up random imaginary transaction is added to the lists of the latest transactions: the nonce. This random imaginary transaction is what makes the compiled list of transactions have a different check sum. The check sum needs to be lower than the target set for the current difficulty set. I believe s simple explanation of all this is possible. At the end of the day there are no token just signed transactions (including mining rewards) entering the block-chain resulting in different balances for each bitcoin address.

  6. Great explanation! And I agree with AA that one of the biggest opportunities today in the crypto space is creating end 2 end user experiences that is easy and intuitive to the average user.

  7. Brilliant as usual. My mom has been trying to send me money and she has been hitting a wall for a handful of reasons using Zelle & others as the payments keep getting bounced back…. I think it’s a good time to talk to her about this

  8. Liked , understood and shared to my mum = true ;

    But the problem am in Kenya she will definitely say she sees no difference to M-pesa 🙂 , But i will try my best

  9. Can't wait to meet you in Denver on Aug. 6th! Going to bring my dad along to learn about Bitcoin, I don't do a good job explaining it to him. Another excellent vid Andreas. Thank you!

  10. I'm confused. I often hear people say bitcoin is faster but I purchased an online product the other day with bitcoin and had to wait about 20mins for the confirmations before receiving the product. Where as a credit card is pretty much instant?

  11. I agree that's there is a lot of progress to do with Bitcoin in terms of user experience, I once explained it to my parents (decently I think) but when it came to manipulation it was a nightmare.
    On this topic there is a cryptocurrency that has been released called Nimiq that is completely browser based and so completely installation-free (being wallet/mining/nodes) with a really nice UI to be "mom-friendly", you should give a look, you just have to connect on the nimiq website.

  12. First off, I like this. The following is meant to be constructive. I actually have my own experience with my mother trying to explain blockchain currencies. She looked at me with a glazed look in her eyes and just said "yes". The next week she came to our house and said that a man on the radio (he was obviously smarter than I am) was talking about bitcoin and he explained that it is simply a "Public Ledger". She says she understands that. I said yes, that's part of what I said. However, I have to admit, I never used the word "ledger". So… my 2 cents is… if you are going to have a video of explaining this subject to mothers (or older people in general) you HAVE to use the word "ledger" at least once. My apologies if I missed you saying that but I don't think I heard it in your video. Again, I like your work. This is just a suggestion. Thanks.

  13. ezpz
    "Bitcoin is a currency with all the benefits of being digital and decentralized, and it's purchasing power cannot be stolen by banks, through inflation."
    Where's my prize?

  14. Can Bitcoin become entire world’s currency with 8 decimal places only? Can decimals be increased if needed?

  15. Good, but next challenge: Explain how Bitcoin actually WORKS, to my mother.

    (In the above, Andreas only explains the uses and advantages of Bitcoin over other currency systems, which is the relatively easy part)

  16. He didn't explain anything. He just said "it's digital currency". I'm sure people know it's a digital currency. What they want to know is: what gives it value? is it stable and why? security?

    Literally said nothing important in those 6 minutes.

  17. hi aantonop. anyway question you focus alot on the 2 billion people whom dont have bank accounts. so question is how do they buy this bitcoin without a normal bank. are you counting on the bitcoin cash machines that are popping up around the world. alot off the 2 billion must be in africa and there are very few machines there so how are these 2 billion going to join us?

  18. What the hell we were thinking with these plastic cards. And they will not understand what we are talking about.

  19. Hey @aantonop! PewDiePie is advertising a streaming service with strong crypto-component to his 93 mil subs. Can you please explain, how Lino blockchain is utilizing open sources projects Tendermint and Cosmos. The consensus algorithm is called "PBFT based PoS". There will be a lot of people on this, and this is, most likely, will be their first actual experience with crypto. Should we be worried, or is this legit good old open decentralized not in any way premined coin?

  20. Here is one 70 year old grandma who pays all BPay bills with Bitcoin. And quite often the Bitcoin I have purchased goes up in value …. Woohoo I often win and if Bitcoin goes down, I just pay with fiat!! Now I need to buy the grandkids a hard wallet each and get them started.

  21. Ask her if she understands the difference between "money" and "the promise of money". Then ask her to give some examples.

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