If you’re confused by Bitcoin and curious about blockchains, The Age of Cryptocurrency by Wall Street journalists Paul Vigna and Michael J. Casey offers a comprehensive introduction to the world of cryptocurrencies. You don’t need to be a mathematician or tech expert to understand the content.

The book explores early efforts to create digital currencies, such as David Chaum’s DigiCash and Sholom Rosen’s Electronic Monetary System (EMS) at Citibank in the 1990s. These early attempts were ultimately discontinued, partly due to significant changes in the banking industry, including the formation of CitiGroup.

A substantial portion of the book is dedicated to the development of Bitcoin by Satoshi Nakamoto. Nakamoto built upon previous ideas to create the blockchain, a system that maintains a public, immutable ledger verified by numerous computers.

Bitcoin gained prominence during a period of distrust in traditional banking, with significant events like the Cyprus bank account freeze highlighting its appeal as an alternative. This and other instances of financial instability contributed to Bitcoin’s rise as a potential safe haven from government intervention.

Vigna and Casey discuss various use cases for Bitcoin, such as its role in Argentina’s fight against inflation, its impact on women’s empowerment in Afghanistan, and its assistance to the unbanked in emerging markets. They argue that cryptocurrencies have the potential to disrupt conventional financial systems.

The book also addresses the volatility and risks associated with cryptocurrencies. It covers the so-called “Wild West” phase of cryptocurrency development, including controversies like the collapse of the MtGox exchange and the shutdown of the Silk Road marketplace by the FBI. Despite these issues, the authors emphasize the collaborative nature of the crypto community as a strength.

However, they acknowledge that Bitcoin is not without vulnerabilities. A potential risk is the so-called 51% attack, where a group of miners could temporarily gain control of the blockchain’s processing power. This could allow them to manipulate transactions or rewrite transaction history, posing a threat to the system’s decentralization.

The authors note that while cryptocurrencies offer significant potential, they are predominantly used by a relatively small group of wealthy individuals. They conclude that despite the challenges and ongoing need for improvements, cryptocurrencies are likely to remain a significant part of the financial landscape due to their ability to address issues that existing payment systems cannot solve.