Cash can be exchanged between two parties very easily. In contrast, this was not possible with electronic money. Someone could copy electronic money in any way they like, such as a picture – imagine a photo of a bank note.

Electronic payments therefore required a trusted third party, such as a bank, to hold the accounts and verify the transaction.

Bitcoin solved exactly this problem. It no longer takes a financial institution to make a payment between two parties. You can also store the bitcoins without a bank or the like.