Bitcoins are not like oranges

My name is Joel Wandimi.
I am a jack-of-all-trades, master of content creation. I love the idea of incorporating fun in learning. My introductory post is about a real experience I had recently that shaped my understanding of how people process abstract ideas.

Explaining cryptocurrency to those who have never heard about it can be an arduous task. I had the misfortune of attempting to educate one member of our investment group. He turned out to be a little more impervious to logic than I anticipated but at the end of it we had a good laugh and now he is the butt of all bitcoin jokes in our group.

The laughter started after I told him that the value of bitcoin had risen to $16,000 from $8,000 in a matter of months and he responded with this: “That’s damn expensive! I cannot afford a single bitcoin.” I proceeded to explain that bitcoins are not like oranges that they have to be sold whole. (I swear it sounded much funnier in Swahili). I told him that one only buys a fraction of it if they do not have deep pockets. His next two questions baffled me to the core because I could not imagine how he processed information. After a pensive pause, he asked me, “what happens to the other fraction of the bitcoin that you do not buy? Is it safe?”

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As the room exploded into laughter, I could not help but think of Karl Pilkington, the round-headed buffon of the Ricky Gervais Show. I almost exclaimed, hands outstretched, “Karl Pilkington ladies and gentlemen…As I live and breathe!”

Although the episode of laughter ended my lesson, I want to believe that I gave him a good preface to the subject. I reached deep into my well of knowledge about money concepts and polished his thinking. To jog his brain up, I asked him if he had ever heard of a time when cowrie shells were used as currency on our Kenyan shores and he told me that he had.
“What qualities made the cowrie shells suitable as a means of exchange and store of value?” he named a few qualities but I added perhaps the most important one in the context of cryptocurrency: “Obtaining cowrie shells from their natural source involved a great degree of effort.” In the same way, cryptocurrencies involve difficult “mining” processes and in the case of STEEM, a great deal of work.

I also learned a lot as I taught him, but perhaps the most important lesson was that the credibility of a currency is related to the degree of difficulty involved in getting its units. This observation holds true for all cryptocurrencies. That is a lesson for another day.