and I'm Catherine.

Sam: And I'm Sam.

Catherine: Now, Sam, what can you

tell us about cryptocurrencies?

Sam: The word is a combination

of crypto, from cryptography, which is

to do with using

clever software codes to protect

computer information and systems,

and currency, which is the money

of a particular country. So cryptocurrency,

very simply, means code money.

We usually think of money as

notes and coins which come from a

country's bank. But a cryptocurrency

doesn't have physical money. It's purely

digital and is not controlled

by banks or governments but by

the people who have it and very complex

computer codes. Perhaps the most

well-known is Bitcoin.

Catherine: Well, you seem to know

a fair bit about cryptocurrency actually...

anyway, now a new player is joining

the digital money system as Facebook

have announced they are

launching their own digital currency. They

are calling it 'Libra'. And we'll be finding

a little bit more about this topic in the

programme, but first, a question.

Now, Sam, you mentioned Bitcoin

as being a well-known cryptocurrency.

It was, in fact, the first

cryptocurrency, but when was Bitcoin

created? Was it:

a) 2008, b) 2009 or c) 2010

Sam: I'm going to say 2010.

Catherine: OK. Well, I'll reveal the answer

later in the programme.

Now, Jemima Kelly is a financial

journalist. She was talking on the BBC

radio programme Money Box Live

about the plans for Libra. She says

it's not really a cryptocurrency

because it's actually

backed up by a number of real currencies.

So which currencies does she mention?

Jemima Kelly: A cryptocurrency

is normally subject to the whims

of crypto markets, which

are notoriously volatile, whereas Libra is

kept stable by being backed up

by a basket of currencies, in this case,

the dollar, the pound, the euro and

the Swiss franc.

Catherine: So which currencies

did she say were backing up Libra, Sam?

Sam: She said that the dollar, the pound,

the euro and Swiss franc were the

currencies that would be backing up Libra.

Catherine: And this is different

from regular cryptocurrencies, isn't it?

Sam: Yes, cryptocurrencies

are completely independent of

financial institutions and

other currencies.

Catherine: And this can make them risky,

can't it?

Sam: Yes, she says that

cryptocurrency markets are notoriously

volatile. Something that is

volatile can change very quickly. When it

comes to currency, it means that its value

can go up or down by a large amount over

a very short period of time.

Catherine: And it's described as

notoriously volatile because this

has actually happened

a few times in the past. Something that is

notorious is well known or famous but for

a negative reason. So the value of

a currency going up and down

in a volatile way - that's not positive.

Sam: If you want to take the risk you

could make a lot of money,

but you could also lose

a lot of money - more than you invested.

Catherine: So why are cryptocurrencies

so volatile?

Sam: Most currencies are reasonably

stable. This is the opposite of volatile.

They don't change a lot over a short

period of time. There can be big changes

but usually governments and banks

control currencies to prevent it.

Cryptocurrencies don't have

those controls.

What Jemima Kelly said was that

they are subject to the whims of the

crypto markets. A whim is

an unpredictable or irrational decision

or trend and if you are subject to

the whims of something, or someone,

it means that metaphorically you are

a passenger in a self-driving car

which may decide just to drive off

the edge of a cliff. So it might be

an exciting ride,

but it could end in disaster.

Catherine: Right, it's time now to get

the answer to the question I asked

at the beginning of the programme.

Bitcoin was the first cryptocurrency,

but when was it created? Was it:

a) 2008, b) 2009, c) 2010

Sam: I said 2010, but I'm not really sure.

Catherine: And you're absolutely wrong!

The correct answer is 2009, so no luck for

you this time, but congratulations

to everyone who did get that right.

Well, anyway, let's round off today

with a review of today's vocabulary.

Sam: First off there is cryptography

which is the use of special codes to keep

computer systems and content safe.

Catherine: A currency is the money

of a particular country, for example

in the UK we have the pound, in the US

there's the dollar and in many countries

in Europe the currency is the euro.

Sam: Cryptocurrency is a combination

of cryptography and currency and

it's used for a finance system that is

based on secure digital coins that are not

connected to banks or governments.

Catherine: We then had the expression

subject to the whims of. Whims are

unpredictable decisions

and if you are subject to them it means

you can't control them, you have

no choice but to go in the direction

those whims lead.

Sam: This means that the value of

cryptocurrencies are notoriously volatile.

They have a history of going up or down

in value by large amounts and very

quickly. And that's not good.

Catherine: Well, it might be good if it goes up!

Sam: True.

Catherine: But if you want less risk, if you

want your currency to be the opposite

of volatile, if you want it, in other words,

to be stable, then maybe

cryptocurrencies are not for you.

Sam: Well, we are subject to

the whims of the schedule

which means our 6 minutes are up.

We look forward to your company

again soon. Bye for now.

Catherine: Bye!