Now that President Donald Trump has vowed to make “America the crypto capital” and just announced plans to create a “Crypto Strategic Reserve,” it’s worth reviewing exactly what Bitcoin and cryptoassets are all about.

Widely misunderstood, blockchain technology and cryptoassets are often wrongly associated with anarchy and upheaval. In reality, the blockchain community is a haven for tech nerds who believe they are solving important problems. Given sensible government policy, this brilliant community could deliver meaningful value for the broader economy. But poor policy could let fraudulent activity proliferate.

I research and teach cryptoeconomics, and I can tell you that blockchain technology is coming fast and hard. There are many cautions, but there is also much opportunity.

First, a little history. The cryptoasset craze began in 2008 with the release of a short technical document, the Bitcoin Whitepaper, which proposed a technology that we now know as the Bitcoin blockchain. Briefly, it is a digital ledger that records transfers of bitcoin, a digital asset that is created on the Bitcoin ledger. Transfers of the bitcoin asset are recorded in chunks known as blocks, and the blocks are sequenced over time into a chain. It’s a chain of blocks — a blockchain — which is a publicly auditable trail of all bitcoin transfers forevermore.

Bitcoin is “permissionless,” which means the blockchain requires no central authority, such as a bank, to settle payments. Cryptoassets, properly handled, can create a more competitive market to benefit consumers. To be sure, there are also some bad actors in the cryptoasset sector and, therefore, some risks associated with its growth.

There are two especially important things to understand about Bitcoin. First, Bitcoin relies on well-established computer science methods, including a cryptographic digital signature system, a cryptographic hash function and a spam fighting protocol (proof of work). In other words, Bitcoin relies on solid intellectual foundations.

Second, Bitcoin’s true significance is that it solved an important economic issue: the double-spending problem. In a traditional financial system, all payments go through a bank or other centralized intermediary, which simply rejects any payment that exceeds the user’s balance. But a user of a permissionless payment system could spend the same balance twice, effectively defrauding the system.

Bitcoin’s genius is that it constructs a novel coordination rule, the Nakamoto protocol, to enable an unlimited set of decentralized parties to coordinate to preclude double spending with no need for a centralized intermediary. Ultimately, this is what interested tech nerds worldwide and led developers to key in on blockchain.

That said, Bitcoin is no longer the primary focus of the blockchain community. In 2015, the Ethereum blockchain launched, shifting the paradigm. Bitcoin is merely a payment system, whereas Ethereum is a virtual computer, bringing a much wider set of applications. The Ethereum blockchain enables the deployment of programs that can be coded to deliver financial services without an intermediary. Since anybody can deploy a computer program to the Ethereum blockchain, this creates a competitive market, which benefits customers. Some of the financial services offered on the Ethereum blockchain include trading, borrowing and lending.

It is hard to design computer programs to offer intermediate financial services. Such programs must be simultaneously rigid to ensure transparency, yet flexible to maintain solvency during adverse market conditions. Nonetheless, the blockchain community has made remarkable progress: Billions of dollars move daily through these computer programs, which have maintained solvency despite large market fluctuations.

Bitcoin was an intellectual spark that started a fire. There is now an army of brilliant developers working to improve the provision of financial services through computer programs. Against this backdrop, it is important to realize that government policy can either enable or undercut technological and economic progress.

The president has already issued an executive order on crypto. It’s wise to embrace crypto as a reality rather than ignore it or, worse, push it away. In working with rather than against crypto, policy makers should seek to serve an appropriate infrastructural role, as the government has for the internet. In this way, policy makers can support the intellectual firepower in the blockchain community while also providing reasonable safeguards to protect users.

Fahad Saleh, Ph.D., is an associate professor in the Warrington College of Business at the University of Florida. His research examines economic questions associated with blockchain and cryptoassets.