Cryptocurrency

• Crypto Currencies can provide people with an easy way to send and receive wealth (even when their home countries currency is worthless or in rapid decline)
• Allow individuals, companies and countries to escape the control of central banks and regulations
• International Assets - they are accepted all over the world without need to be exchanged for local currencies/assets
• Serve a similar function to gold, but may have more upside since they are not yet widely adopted
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• Governments are not able to control cryptocurrencies like they can fiat currencies
  • They can't block payments
  • They can't freeze accounts
  • They can't seize assets

• Based on globally, decentralized & distributed networks (no one person is in control)
  • Puts the power in the hands of the broader community
• Many currencies have a way to increase supply
  • Often this requires "mining" (analagous to physical previous metals)
  • The supply increase is often limited to a certain amount/% per period of time

• Typically come in fixed quantities (no one can print as many as they want)
• They are decentralized - the government can't control them.  Power is not in one peron's hands
• They don't require banks to safely hold (no risk of bank failure) 
• The supply of coins/money/token is strictly regulated and/or limited (unlike fiat currencies)

• Governments may try to regulate our outlaw them (they take power away from central governments)
  • Some countries have already tried to outlaw
  • Mitigation:  It will be hard for governments to take don a decentralized system
  • Mitigation: Other countries are actively investing in crypto technologies and encouraging crypto businesses
  • Mitigation: Governments were unable to stop other distributed technologies (example:  Bit Torrent)
• Quantum Computing could render the encryption that backstops the system
  • Currencies can use algorithms that are safe from quantum computing

  
  

• Hacking and Theft is common - nearly $927 Million stolen in first 3 quarters of 2018

Crypto Currency Using Classic Definition of Money

• It is a medium of exchange
• It is a unit of account
• It may or not be a store of value
• Wild price swings may indicate that it is not a good store of value (depends on confidence of holders)

Government Sponsored CryptoCurrencies

• They may run the same risks as fiat currencies
• Government regulations
• Government controls
• Government printing