And I mean LITERALLY explain like I’m 5, I literally know nothing of the technical terms and such
In: Economics
Two ways generally
1) Most people making money are making money because buying/selling bitcoin is just like buying and selling shares of a stock of say Apple. Apple goes up because shareholders speculate it has value. In the same way Bitcoin goes up or down based on the fact that the people buying and selling it believe that it has value. Sure apple has a business plan and some financials to back some of their value up… but ultimately a belief doesn’t have to be rational for there to be value there. and so bitcoin has some value based on the number of people who use and hold bitcoin.
2) a whole industry of distributed micro-lending now collectively known as “DeFi” has cropped up, allowing people who hold trusted crypto currencies on certain platforms to lend out some percentage of that value and get a small percentage of interest in return, this is much more boring than stories of people holding crypto for a few years and being able to sell their “stocks with 100x return because of some viral moment on twitter or whatever… but its much closer to how more traditional investments work and is much more understandable.
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