ELI5: What are cryptocurrencies?

Imagine your Lego collection. You and your friends love trading Lego bricks.

Instead of trading real bricks, let's say we invent Lego Coins. These coins aren't real Lego; they are just numbers in a special notebook everyone shares. This special notebook is called a blockchain.

Here's how it works:

• Making a Trade: If you give me 5 Lego Coins for a cool Lego spaceship, we write it down in the blockchain notebook. It says: "You gave 5 Lego Coins to me". Everyone with a copy of the notebook can see this trade.

• Keeping it Safe: This notebook is very special. It's copied and shared with everyone in our Lego trading club. So, nobody can cheat and say they didn't give you the coins, because everyone else has proof in their notebook copy!

• Creating New Coins: Sometimes, we need more Lego Coins. We can create new coins by solving puzzles. Imagine building a super-complicated Lego model following a specific pattern. The first person to finish the model gets to add new Lego Coins to the blockchain notebook as a reward. This is like mining in the Lego Coin world.

• Value: The Lego Coins have value because we all agree they do. If everyone wants them to trade for rare Lego bricks, then they are valuable. If nobody wants them, they are worthless.