Technically he's right on the encryption part, just explain to him you're solving blocks to get bitcoins which can then be converted to fiat. Explain what bitcoin is, how it works - then show him a list of exchanges (BTC-E) for example, of course after that show him a real exchange market and than explain to him that this is just another fiat/stock exchange that's up and coming and you just want to get in as quick as you can so you can milk them cows.