Starting with the basics
I think we’ve all been there. You’re at a family gathering, someone asks about crypto, and suddenly you’re trying to explain proof-of-stake to someone who hasn’t even heard of Ethereum. It usually doesn’t go well. You end up jumping from smart contracts to DeFi to blockchain fundamentals, leaving everyone more confused than when you started.
Perhaps the problem is that experts think about this stuff every day. They’ve internalized concepts that beginners find completely foreign. Ben Thompson, who writes about tech but only mentions crypto a couple times a year in his newsletter, actually offers one of the clearer explanations I’ve seen.
The internet-like currency
Thompson starts simple: “Blockchains are the idea that disparate groups can come to a consensus without any kind of centralized authority.” That’s a good starting point. He then connects it to something familiar – digital goods. Crypto has all the qualities of digital things – easy to copy, accessible everywhere, simple to distribute – but with one key difference: scarcity.
This scarcity matters because, as Thompson points out, digital goods are “fundamentally hard to monetize because they are infinitely duplicable.” Crypto solves that problem. In practice, he sees stablecoins as the most interesting application – they offer the benefits without the wild price swings.
“What you end up with is basically this currency that operates like the internet,” Thompson says. That’s a definition I wish I had at that dinner. Crypto as internet-like currency makes sense to people.
Why businesses care
The explanation gets more practical when Thompson talks about why fintech companies might use blockchains. “If you want to set up some kind of financial entity, you don’t have to build out the backend to track everyone’s finances…you can just build it directly on top of the blockchain.”
This means companies can offload the difficult parts – holding money, reconciling accounts, maintaining transaction records, establishing trust. “You get all that for free with blockchains.” That’s the appeal for businesses, and it’s becoming more relevant as traditional finance companies explore blockchain integration.
The park bench analogy
There’s another explanation I keep coming back to – a Medium post from 2013 that uses apples on a park bench. The author imagines digital apples that behave like physical ones. The blockchain records all transactions in these digital apples, living on everyone’s computers.
Sending one becomes “as good as seeing a physical apple leave my hand and drop into your pocket.” And just like on the park bench, the exchange involves only two people – no bank (or “Uncle Tommy”) needed to make it valid.
This setup naturally leads to explaining proof-of-work: you could participate in updating the ledger and get rewarded with digital apples. That’s the only way to create more, establishing scarcity. “That system I explained exists. It’s called the Bitcoin protocol.”
Keeping a beginner’s mind
Maybe the real lesson here is about mindset. There’s a Zen concept called shoshin – approaching something with openness, eagerness, and no preconceptions. “In the beginner’s mind there are many possibilities,” as the saying goes. “In the expert’s mind there are few.”
It reminds me of that scene in Big where Tom Hanks’ character, a kid in an adult’s body, keeps saying “I don’t get it” during a toy company meeting. His simple questions lead to better ideas because he’s not trapped in expert thinking.
With crypto, maybe we need more of that. Not jumping straight to technical details, but starting with basic concepts that connect to what people already understand. Digital apples on a park bench. Currency that works like the internet. Sometimes the simplest explanations are the hardest to find, but they’re worth looking for.
