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I am not an economist, but for 10 years I owned and operated a finance company.

For 44 years, I have co-managed my family finances.

So when I started hearing the terms cryptocurrency and bitcoin, my ears perked up.

What in the world is a bitcoin, and is cryptocurrency a kind of ancient money found entombed in an archeological dig?

Bitcoin is a type of cryptocurrency, which is defined as a “digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank.” When searching cryptocurrency, it becomes instantly clear bitcoin accounts for most of the information.

Donald Mross, a former Virginia Tech computer scientist, is an avid advocate of bitcoin and has produced a documentary on his journey and success in the world of this new monetary system. While he states that describing bitcoin is very complicated, he used the development of the Internet as an analogy.

In 1994, very few people understood the Internet, let alone could predict how it would change the world. Email changed the way people communicate. Bitcoin changes money as we know it.

Bitcoin advocates say by eliminating a central authority (our current banking system) that can manipulate the value of your money, bitcoin “puts the bank in your own pocket.” It’s global, decentralized money. Users send and receive digital currency over the Internet.

Bitcoin is issued according to a fixed set of rules. When you send someone bitcoins, the transfer is broadcast over the entire network.

It is then verified and recorded in a public ledger called a block chain, which consists of every transaction that has occurred since the system began. Because this is all done digitally, the information is shared and maintained on the network.

So everyone keeps the books.

Privacy issues are addressed by a complicated encrypting process consisting of multiple steps involving very long strings of “password” usage, which ensures transactions remain anonymous.

Really? Anonymous money transfer? Seems like a bad guy’s dream.

Heather Lowe, legal counsel and director of government affairs at Global Financial Integrity, a think tank focused on preventing illicit finance, said, “The underlying technology has positive uses.”

She went on to note the Financial Action Task Force, an international organization aimed at preventing money laundering, is exploring cryptocurrency oversight.

Well, that makes me feel a lot better.

Bitcoin now is being traded on various markets. Bloomberg Technology 2017 reported two U.S. exchanges, including the parent of the venerable Chicago Mercantile Exchange, are racing to embrace bitcoin.

This development shows how some big financial players are moving to co-opt the volatile cryptocurrency and lure more mainstream investors into the market, even before regulators have agreed on just what bitcoin is.

Bitcoin was introduced in the wake of the 2008 financial crisis as a way of avoiding governments and central banks. Now, with its meteoric rise and the proliferation of cryptocurrencies, banks, brokers and mainstream investors want in.

Even with all this confusion, increasingly, bitcoin is being accepted as payment for goods and services. Will bitcoin really do to our banking system what email did to the postal service? I don’t know about you, but my brain is about to explode.

Wendy J. Levenfeld is a published novelist, playwright and columnist from Chesterton. Send comments to wendylevenfeld@gmail.com. The opinions are the writer’s.

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