Cryptocurrency
Also called: crypto, digital currency
Digital money run by networks of computers rather than a government or bank.
Whether the underlying technology matters long-term is a genuine open argument, and this is not the place to settle it.
The narrower point is what you own when you hold a coin. A share is a piece of a business: it has products, customers, employees and profits, and you have a claim on what it earns. A coin has no engine underneath — no products, no profits, nothing paid to you for holding it.
Its price is therefore whatever the next person will pay. That makes buying one a bet on the mood of a crowd rather than ownership of something productive. It can rise enormously, and that is not evidence against the description; a bet can win.
The practical consequence: it does not behave like the long-term investing described elsewhere on this site, and the reasoning that supports patient index investing does not transfer to it.
If you want exposure anyway, treat it as a bet: an amount decided in advance that you can afford to lose entirely, kept separate from money that has a job.
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Covered properly in Learn.
This term appears in the glossary of The Quiet Fortune, Volume I.