With the holiday season almost here, chances are that your parents will want to have The Talk with you. Despite telling them that you know what you’re doing, you will most likely still be answering the usual questions:

What exactly are you doing with Bitcoin? 

Can it help you make real money?

The holidays are a time to reconnect with your family and explain technology in a way in which your parents will understand. With the help of this article, this year you might just have the luck you’ve been hoping for.

The best way to start your conversation is by assuring your parents about the fact that Bitcoin is money. Not just money but it works like stocks as well. By not mentioning the word cryptocurrency, you make it easier for your parents to understand this foreign concept. 

Next up, your parents will probably be confused about how it can be both. To this you can tell them that Bitcoin, like all other currency, can be used to buy trades and services. You can also use it as a stock because its value fluctuates from time to time. Unlike traditional stock though, there is no dividend involved. Just the value of the Bitcoin on that day. 

This should help your family understand the basic concept of Bitcoin and how it works. Once they have understood this, more questions will certainly follow like:

Where are the Bitcoins then? You don’t actually have them, do you?

You may be a bit agitated but remember that the key is to talk to them in a language that they will understand. You can use banks as a great example here. 

“Just like salary is credited to your account, Bitcoins cannot be seen but exist. The only difference is that unlike traditional money, they can never be touched or felt.”

Avoid using the word virtual here because you are trying to simplify things and not complicate them. Further questions, of course, will keep arising.

I know that my money comes from the job I have. Where does Bitcoin come from?

This is where you need to get a little creative. To explain mining better, start off by introducing them to a mountain made of a 21 Million Bitcoins. Ignore the sly comments and go on to say that if there is a hypothetical said mountain, then one has to mine for these precious resources. 

“Bitcoin miners use their computational powers to mine; say one Bitcoin so they can later break it up and exchange it for money.”

Break it up?

“Yes. Just like a dollar breaks down to cents, Bitcoin can also be broken down. This makes it easier to exchange it because one Bitcoin can be valued at about 8,000$.”

What you’re saying is these things are limited and even to get one you have to use a lot of hardware and software power? Seems like too much work.

“Well yes, but this new economy can be better than the pre-existing economy. For starters, there are no banks in the picture when trading Bitcoin so you don’t need to wait for the approval. You can just trade Bitcoin for money using a bitcoin trading app.  

So in a nutshell, there is no risk of the bank going down and losing your money. You just need your private key to access your Bitcoin. “

But what if you lose your key? How many keys have we lost in this house son!

“No that’s just the name. Your private key is just the 4 digit pin you’ve taken chosen for your bank card. No need to explain the further complicated ideas of a private key just yet. Move on to the other advantages so you can make your sale. 

The best part is that it is a global economy. So the value remains the same everywhere and there isn’t any inflation in the picture because it is limited.”

Right because there’s only 21 Million of it, right?

“Well, …yes and no.” 

Now you come back to mount Bitcoin.

“So far only, 21 Million has been mined but the mountain is still there till the year 2140.”

But how can you spend it if it’s not here?

“Bitcoin transactions exist on the cloud. On everyone’s computer. Think of an online ledger, like a digital accountant. All the money being spent is noted without revealing the details.”

So all the money is on the ledger?

“All the money that is spent is on the ledger called Blockchain. The unspent money can be accessed through your unique numbers. Each Bitcoin has its unique access number but it's better not to write it down anywhere.”

But where do you spend it?

“There are a few places in some cities like certain bars and other shops that accept Bitcoin but it is mainly used for web microtransactions. Most people use it as investments because of their volatile values. In the last year, the prices have jumped from 4,000-8000$. This means that you can have great returns by investing in it.”

You look up now as your parents nod with a better understanding and just like that, holidays are saved.