The record
A blockchain is a shared transaction history maintained under a network's rules.
Foundation · five-minute explainer
Crypto is not one thing.
It is a family of digital assets and networks that use cryptography to control transactions and maintain records. Bitcoin, a stablecoin and a game token may all be called crypto while behaving very differently.
The asset
A coin or token is a digital unit recorded on that network.
The access
A wallet manages the keys used to authorise transactions.
What happens in a transfer
A signed instruction becomes part of the record.
The exact mechanism varies by network, but the useful mental model is simple.
- 01Your wallet creates an instruction
- 02Your key signs that instruction
- 03The network checks it against its rules
- 04The valid transaction is added to the shared record
- 05The recipient's wallet can now control the received asset
The main families
Same label, different job.
Bitcoin
A scarce digital asset with a network focused on transferring and recording bitcoin. Its design favours predictability over rapid change.
Smart-contract networks
Networks such as Ethereum let developers deploy code that can hold and move assets under programmed rules.
Stablecoins
Tokens designed to track another asset, usually a currency. Their stability depends on backing, redemption and market confidence.
Application tokens
Tokens linked to a service, protocol, community or project. The token may have a real function, weak economics—or neither.
What “ownership” means
Control follows the keys.
On an exchange, the platform usually controls the keys and owes you the recorded balance. In self-custody, you control the signing keys and accept the recovery burden. Neither route removes risk.
What “decentralised” means
Ask: decentralised in which way?
A network can distribute validation while a token supply, website, development team or admin key remains concentrated. Decentralisation is a set of design choices, not a yes-or-no badge.
The UK position
It is lawful to own and transfer cryptoassets in the UK, but consumer protection is limited and depends on the product and activity. A firm appearing on the FCA cryptoasset register is not the same as every service being fully authorised.
HMRC generally treats exchange tokens held as investments as assets for tax purposes. Selling, swapping, spending and most gifts are disposals; rewards can create income.
The risk that matters most
A token can work technically and still be a poor asset. Demand can disappear, liquidity can vanish, an issuer can fail and a secure network cannot make a dishonest promotion truthful.
Technology explains how something moves. It does not tell you what it should be worth.
Keep learning
Now make the words familiar.
The glossary adds the practical consequence behind 30 common crypto terms.