This explanation doesn't cover how Bitcoin determines difficulty. I tried to come up with a rewrite that does, but the original example has the "password, which

This explanation doesn't cover how Bitcoin determines difficulty. I tried to come up with a rewrite that does, but the original example has the "password, which they've learned is a certain number of characters in length", and Bitcoin has no such fixed target; rather, it simply requires reaching consensus on transaction ordering, with the first-in-consensus transaction moving some funds being the only valid one (subsequent transactions are double-spends). This consensus is achieved through a game-theoretic setup, involving a PoW chain, which endeavors to: 1) make an attack as expensive as physically possible, and to 2) provide a rational actor with access to a given amount of computational power a stronger incentive to collaborate, than to attack Evidence in favor of Bitcoin's setup achieving the second goal is that the system is still alive despite individuals repeatedly having access to sufficient power to perform double spends; in fact, they already have, yet the system as a whole keeps running: https://bitcointalk.org/index.php?topic=321630.0 https://bitcointalk.org/index.php?topic=321630.0