can anyone explain it to me in laymans terms ?
Cryptocurrency operates in a decentralised system as opposed to real currency which operates under a centralised system.
There's nearly 7,000 different cryptocurrencies out there according to CoinMarketCap.com.
Bitcoin is of course the most well known:
https://www.nerdwallet.com/article/investing/how-to-invest-in-bitcoin--------------------------
Advocates of cryptocurrencies are usually against money supply (via real currency) being controlled by government and more particularly central banks (the Reserve Bank is Australia's central bank). Even though real currency is traded, Central banks control money supply by adjusting interest rates, issuing bonds, buying/selling currency. Central banks don't want large volatility (movements) in the value of a real currency.
Cryptocurrencies aren't controlled by a central regulator at a central location. They are decentralised via an interconnected encrypted digital system. Every holder/trader of cryptocurrency has encrypted access to their own copy of what is the public digital 'Ledger' (what is known as a 'blockchain'). This Ledger is a record of all transactions of the cryptocurrency that have ever occurred. It allows users to monitor and track transactions and follow the provenance of the cryptocurrency. So called 'miners' are paid a fixed fee in cryptocurrency as an incentive to 'approve' a transaction (add a new updated block with the latest transaction details to the existing chain). This updated blockchain (Ledger) is then sent to everyone. The process is one of continually trading, updating and validating. Different cryptocurrencies offer different fees to miners by the way.
Advocates would argue that this massive encrypted decentralised system provides greater security and without an overlord controlling the cryptocurrency nor the need for intermediaries (i.e. normal banks, solicitors, brokers, etc). So in their mind cryptocurrency is the currency of the future. Critics would argue that it's slower leading to higher transaction fees and that it's prone to speculator trading leading to massive booms and busts which doesn't make it a reliable currency for real world purchases nor as an investment. For instance, Bitcoin traded at around US$20,000 in December 2017, its value then dropped to as low as about US$3,200 a year later. It's now trading at around US$50,000.
Blockchain explanation:
https://www.youtube.com/watch?v=3xGLc-zz9cACryptography: How does Bitcoin actually work?:
https://www.youtube.com/watch?v=bBC-nXj3Ng4-------------------------
ps. As an aside, you could use a blockchain system for any asset or in any sector (eg: food). For instance as a customer, it would allow you to say know where the roast chicken and vegies on your dinner plate tonight specifically and exactly came from and how and when it got to the shop/supermarket you bought it from. Advocates would argue that it's better than now where you have to just trust the word of the distributor and store. From that point of view, the future possibilities are endless.
