Ann Marie van den Hurk: Who needs the bank? Digital asset cryptocurrency is creating a new ecosystem

Ann Marie van den Hurk, Lexington Herald-Leader on

Published in Business News

How does it work?

As the U.S. Dollar, the European Euro, or the Chinese Yuan, cryptocurrency is a currency. There are no paper money or coins. It is a new way to digitally pay for goods and services with lower transaction fees than credit cards and banking fees.

It all starts with the blockchain. It is a system that allows a group of connected computers to maintain a single updated and secure ledger. Transactions are recorded in this shared ledger permanently by appending blocks in the mathematical chain of code.

The exchange, or bank, is a digital marketplace where traders can buy and sell cryptocurrency using different fiat currencies which is a currency declared by a government as legal tenders such as the dollar or altcoins. Then the purchased cryptocurrency goes into a wallet where a QR code is scanned by a store to pay for products or services. It is like using Apple Pay, or Starbucks app digital wallets. With cryptocurrency, the transfer is often within a couple of minutes.

Buyer beware

Cryptocurrency is a global free market of what is capitalism in its purest form. It is an entirely decentralized system with no server or central authority governing it.

The market is very volatile. Values can swing within minutes. Unlike the U.S. Stock Exchange where there are safeguards in place; there are none. Add in scammers out there launching new coins and never delivering. Cryptocurrency can be converted quickly into fiat currencies.

We are in the Wild West stage of the cryptocurrency development. U.S. Securities and Exchange Commission (SEC), as well as other governments such as China and South Korea, are reviewing cryptocurrencies and how to regulate them. That said banks that were reluctant to embrace cryptocurrencies have increasingly moved toward developing their coins.


Japan's largest bank, Mitsubishi UFJ Finacial Group is releasing its own in March 2018.

About The Writer

Ann Marie van den Hurk, an accredited public relations professional, is principal of Mind the Gap Public Relations and author of "Social Media Crisis Communications." Readers may email her at or follow her on Twitter @amvandenhurk.

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