Recently we sat down with Danielle Sabrina from the Huffington Post to talk about the current state of cryptocurrency and how it fits in to our vision of a universal approach to personal finance.

The State of Cryptocurrency: What it is and How it Works

Originally published in the Huffington Post.

If you’re new to blockchain (or if you’ve never heard of it), it can seem a bit daunting. Cryptocurrency as an industry is in its infancy, but the barriers to entry are complex. Without a solid understanding of the premise of blockchain or the platforms on which cryptocurrencies are bought and exchanged, it can be difficult to enter the marketplace, and even harder to transact in it.

One of the first things to understand is that blockchain has nothing to do with bitcoin (cryptocurrency), which is a common misconception. Blockchain is the technology behind bitcoin, first invented to serve as a digital ledger to solve the double spending problem without the use of a singular authority or server.

The decentralized technology uses a peer-to-peer network to record and validate transactions (called blocks) across multiple computers so that the records cannot be altered, you can view it and add to it, but you can’t change the information that’s already there. It’s essentially an online database that anyone can use but no one owns, it’s able to stay relatively hack proof because of blockchains’ millions of users.

The gap in the market that remains is that between traditional financial services and cryptocurrency transactions. Bridging that gap will play a significant role in our ability to integrate cryptocurrency into our mainstream lives.

I sat down with Miro Pavletic, Director of STK, to talk about the state of cryptocurrency and his mission to level the playing field between cryptocurrency and cash, starting with point-of-sale. Pavletic says the company’s technology enables users to transact with cryptocurrency in mainstream markets and at brick-and-mortar stores without the cumbersome exchange process typical of most cryptocurrencies.

DS: What are some of the challenges you see in the market today? Why is cryptocurrency such a self-contained industry?

Pavletic: Despite the growing popularity of cryptocurrency like Bitcoin and Ether, mainstream adoption has been a challenge; the hub of cryptocurrency activity remains mostly independent of mainstream markets, widely due to the lack of liquidity.

You can’t readily use your crypto wallet in retail or e-commerce, and merchant acceptance of cryptocurrency at point-of-sale is virtually non-existent.

DS: How does STK make using cryptocurrency more accessible in mainstream markets?

Pavletic: The STK token bridges the gap between cryptocurrency usability and everyday transactions. Let’s say you bought $100 worth of STK last week and it’s gone up in value 20%, which means the value of your tokens is now $120. You’d like to take advantage of the market upswing, so you decide to treat your friends to coffee with your crypto ‘profits.’ You place your order and tap-to-pay with your STK Tokens using your STACK app (digital wallet) on your mobile, just as you would a debit or credit card. Essentially, you’ve used the value of the market upswing to pay in real-time, without touching any of your local currency accounts or your original $100 worth of STK tokens.

To do all of these things without STK would require a significant amount of time, multiple transactions, and at least four different platforms. And even if you wanted to, merchants don’t accept crypto. Your friends that are waiting for their lattes probably don’t either.

STK is the first token to provide this bridge, and we do it through a partnership with STACK, a digital wallet which functions as a stand-alone account. STACK has access to global payment rails, which provide instant access to 39 million merchants across the globe. Its implementation through the STACK app means you can use STK tokens just as easily as you would a debit card or cash.

We’re building a platform that provides equal access to your money regardless of country or currency, and based on the idea that once you’ve earned your money, keeping it should be free.