If you want a "
lies to children" version: imagine a currency based on something mathematically hard to discover, like large prime numbers, rather than physically hard to obtain (like gold). You make money by discovering new prime numbers (or whatever).
Essentially, you provide the computing hardware for solving the computationally difficult problems involved in processing transactions in the electronic currency. Your reward is that the process generates "newly minted" Bitcoin/Etherium/whatever. Its all set up as a rather elegant distributed system with no real central hub or authority and "mining" is an intentional way of gradually introducing new "coins" into the system.
GPU hardware happens to be ideal for the type of computation involved (actual graphics doesn't come into it) - you can build a little supercomputer with a bunch of affordable graphics cards.
(I preferred the Minecraft idea - I
want to be paid for my stockpile of diamonds and ghast tears. However, the whole virtual property thing seems to have gone the way of Second Life and World of Warcraft.)
Oh, and the really stupid thing is that the cryptography problems being solved to mine the currency only have value if you want to have a rainbow table of possible infohashes for things like app store receipts.
Basically, that is the only point of value to bitcoin mining, solving digital transaction receipts on infohashes.
Nevermind that the infohashes are of very limited timeframe, they will keep going until 2140.
That is essentially the only point of bitcoin, a public database of all possible infohashes for a particular algorithm used for app store receipts, essentially giving a permanent free access to paid software from Apple, Microsoft and Steam.
Of course, it is entirely pointless once the algorithm changes to use a different type of infohash, which is likely in the medium term.
What is yet to be realised is that the top ten currencies tend to be over-inflated by Initial Coin Offerings in rubbish schemes like Dentacoin, aimed at currency for dentists and oversubscribed compared to market value, then sold for crummy tokens in exchange for mainstream currencies on the basis of nothing more than a sales pitch and a whitepaper.
(Seriously, there are gimmicky crap coins which are completely pointless for everyone else, yet they get funding by suckers.)
It is fair to say that most currencies are not worth it, especially at the moment bitcoin and ethereum.
Bitcoin is currently about to split at the start of august, removing the main point of value growth.
Ethereum is still failing to work reliably on transferring value, due to a silly programmable bug that allows joint accounts to be raided. Currently, several ICOs have been raided for millions of fiat currency equivalent this year thanks to either multisignature bugs in Ethereum shared accounts, or simply changing the address listed in an ICO.
And yes, there are some ICOs which have gaming tokens for virtual property in game, or casino chips.
Usually the casino chips get stolen quicker than other ICO tokens.
