Is cryptocurrency the end of buying candies for change?
Updated: Jul 12, 2019
A brief study on the practicality of cryptocurrency.
Money, it’s a crime Share it fairly but don’t take a slice of my pie.
Forty-five years since the legendary English band Pink Floyd released one of their all-time popular tracks ‘Money’. It told us everything that was wrong with money, banking, and the economic system. Two years later, in 1975, Satoshi Nakamoto, pseudonym of the famed creator of Bitcoin was born in Japan. Although these details aren’t confirmed, a P2P Foundation profile claimed the above information to be true. But, it doesn’t really matter who the real person is. Because Bitcoin—the celebrity of cryptocurrency, has grown way beyond what its inventor intended it to be. In 2009, Bitcoin was worth $18, and in December of 2017, it reached a peak of $18,000. It rose exponentially in the span of one year, by about 1000%, and that’s when the world took notice of this potentially disruptive technology.
Money, so they say
Is the root of all evil today.
So, what’s wrong with paper currency that someone had to invent a new type?
The answer is essentially, everything. With banks being owned by the elite few, the economy is being manipulated to favour those who’re in power. We saw this with the dot-com bubble between 1997 to 2001, and the housing bubble in 2007 that led to the global financial crisis. It was soon after the housing bubble that bitcoin surfaced. If you have read the news in the last year - then you already know what a cryptocurrency is. For those of you who don’t, it’s a digital asset (currency) that is designed to work as a medium of exchange. Cryptocurrencies use cryptography for securing online transactions, control creation of new additional units of currency, and to verify the transfer of assets. Unlike traditional banking and money, cryptocurrency is completely decentralised. Which means, there is no single body that governs the use, transaction, and creation of money. Bitcoin, in fact, is the first ever established decentralised digital currency and peer-to-peer worldwide payment system. The transactions of Bitcoin, or a cryptocurrency, are recorded in a sort of a public distributed ledger (but digital) known as a blockchain. Now, a little bit about blockchain. Think of it as a library record. Whenever you borrow a book, the librarian mentions it in the record book with your name and the name of the book in it. Similarly, blockchain is a record book of all the spends and transfers of the cryptocurrency, in this case, a bitcoin. It is updated numerous times an hour and shared with all the nodes. Which means, each bitcoin contains the history of every bitcoin ever spent, transferred, and so on.
So, it sounds like a great new way to pay, right? Cryptocurrency, the name’s cool, there are no physical notes or coins, and the government doesn’t control it! Hurray! A win for the rebels (or masses - depending on how you look at it). Right? Well, sorry to disappoint you, but the win is not really close. While the technology seems like a perfect fit for the future, its path to glory doesn’t seem easy. According to a time.com article, futurist and author Thomas Frey wrote that “Cryptocurrency is very much here to stay. Cryptocurrencies are going to displace roughly 25% of national currencies by 2030. They’re just much more efficient, the way they run.” Another expert Dr. James Canton from the Institute for Global Fortunes in the same articles says, “(I’d say) You can expect an exponential increase of new investment vehicles to come from cryptofinance.” All this sounds promising, especially when millennials, the generation that (is) will be the prime ruling generation of the future, seem to prefer this form of money.
But if you ask for a rise
It’s no surprise that they’re giving none away.
So, what’s stopping Bitcoin to become the default way to pay?
Here’s the thing, cryptocurrency doesn’t fit traditional regulatory definitions. And the future of Bitcoin, or any other cryptocurrency for that matter, will be determined by those in power—the policymakers. Currently, Bitcoin is valued at around $142 billion, and is predicted to reach about $1.2 trillion by the end of 2018. At this price, Bitcoin is valued more than Goldman Sachs and eBay. The worrying factor for the ones in power, or the policymakers is not the massive amounts of money invested in this technology, it is its potential to be as disruptive as the internet itself. Crackdowns have already started on bitcoin. And here is the list of countries that either do not recognise bitcoins as legal tender, or are already planning some measures against it.
And well, there are a few countries that have taken a generally positive approach toward cryptocurrency.
The bottom line is, Bitcoin and its regulation is one of the most important cases of the current time. And the decision to go with it, or against it, will heavily influence how the future unfolds for all of us.
By the way, does anybody have change? I need to pay for my candies in cash, at least for now.
LOOKING FOR DIGITAL + DESIGN SOLUTIONS FOR YOUR BUSINESS?