Currency is vital to the global economy. It allows us to agree upon the value of something and exchange goods and services quickly. From building bridges to rocketships, currency incentivizes and coordinates people to work on things together by providing a standard global value (SGV). It’s a communication tool!
It is no secret that the global economy is suffering and when a system that is vital to our survival is broken, people suffer! Let’s explore the only viable solution to our economic crisis and how we can help implement the changes faster.
Currency History Overview
As far back as we know, humans have been exchanging or trading goods and services. From direct trades to using gold to using currency, we continued to find faster ways to complete transactions. Switching to a fiat currency system allowed more people to participate in the exchange process, which propelled globalization.
Fast forward to 1944; the US dollar was chosen to be the global currency. At that time, the dollar was backed by gold and held most of the world’s gold reserves in US vaults. This system was not sustainable and later was switched to our current system using fiat currency.
So what is fiat currency exactly? According to the decentralized information network, Wikipedia, fiat money is “a currency without intrinsic value that has been established as money, often by government regulation. Fiat money does not have use value, and has value only because a government maintains its value, or because parties engaging in exchange agree on its value.”
Today, major global currencies such as the dollar and euro, are fiat currencies.
The Problems With Fiat Currency
For all of history, we have exchanged goods and services with something of value and money was backed by intrinsic value. Once the gold standard couldn’t support our spending habits, fiat currency became the next temporary solution for a broken system. Fiat currency is backed with a government promise and has no use-value and has proven to be unsustainable due to fiat being:
- Unlimited. Cash comes in unlimited quantities and is printed on demand and issued endlessly. Printing money causes inflation along with other issues and is only a temporary bandaid.
- Untraceable. Cash is untraceable and easily transportable, making it easy to use for illegal activities not just amongst criminals but governments too. When you reach for your dollars, you don’t know where that dollar has been and what hands have passed it on or what activities that dollar supported.
- Centralized. Fiat currency is regulated by a central authority such as a central bank. The value and supply of cash are determined by Beurocrats, who meet behind closed doors and establish and regulate the supply of new currency.
- Banks. Since fiat money is not a fixed resource, central banks have much greater control over the supply, giving them the power to manage economic variables such as credit supply, liquidity, and interest rates. Not everyone in the world has the luxury of having a bank hold their money or have a guarantee the money will still be there: especially 3rd world countries that have very high fraudulent activities and corrupt governments.
- Access. There are approximately 1.8 billion people who have a cell phone but no access to financial services like banks and are not contributing to the world economy. Furthermore, even for those who do have access to a bank account, our current financial system doesn’t enable people to move money freely. A bank holds the assets and determines if and when you can move your funds. The bank can keep your funds for weeks while deciding to transfer, and when a decision is determined, the transfer is usually very costly.
Printing money isn’t an option anymore, and economic infrastructures are failing, it is time for the next currency. Bitcoin is a revolutionary digital currency that is transforming the way we pay peer-to-peer globally.
A Digital Solution. What is Bitcoin?
In 2008 after the global financial crash, many US citizens lost their savings, retirement plans, jobs, and homes. The banks and government broke people’s trust. Then, one day, in 2008, a whitepaper emerged, presenting a new currency that looked nothing like seen before and had capabilities to solve problems no fiat system could; Bitcoin.
Bitcoin is a peer-to-peer digital currency (cryptocurrency) that requires no third party like a bank or government to perform transactions in just seconds. Because it does not require a central authority, such as a bank or government, it runs on a decentralized public network. It uses complex cryptography to secure financial transactions, control the creation of additional units, and verify the transfer of assets.
Bitcoin is a new payment system that does two things at once and requires no 3rd party to work. Unlike anything before, it combines currency and payment processing into one. Payment processing networks like PayPal or Visa process money, but they are not a currency. The dollar is a currency, but it is not a payment processing network. Bitcoin is BOTH, thanks to Blockchain technology!
What is Blockchain?
Blockchain is a distributed, decentralized public ledger that continuously updates on who holds what. Blockchain can be broken down:
“Block” = digital information
“Chain” = public database
A live recording of new transactions on the blockchain public ledger. Anonymity and transparency.
Secure Bitcoin Transactions
Blocks store transaction information like the date, time, and dollar amount. When a block stores new data, it is added to the blockchain and strung together with other blocks. Four things must happen to add a new block to the public blockchain:
Crypto transaction process. #bitcointransaction #bitcoin #verified
- A transaction must occur.
- That transaction must be verified.
- The transaction must store in a block.
- That block must receive a hash (a “verified” code).
The transactions get secured with cryptography, which is security provided through complicated MATH and creates, what we like to call, “automated trust.”
Bitcoin miners use sophisticated computers to solve complicated mathematical equations to verify and add a transaction to the blockchain. Once checked, a block stores that transaction which can not be changed. With every new transaction, the blockchain network becomes more and more secure.
Why Bitcoin?
Bitcoin is King. The future of money is here. Learn about your future.
Did you know that Bitcoin is the fastest-growing asset in all of history? Read that again. Bitcoin is the 6th most circulated currency in the world. There are 21 million Bitcoins created with about 16 million Bitcoins circulating, and there will NEVER be more made.
Grasping the essence of Bitcoin and Blockchain that powers the currency can be difficult, so here are some apparent reasons Bitcoin is the answer to our current global economic crisis and is the global payment solution. Bitcoin is:
- Finite. While other cryptocurrencies have emerged since the birth of Bitcoin, Bitcoin has a FINITE supply of coins. Unlike cash, gold, or other precious metals, new Bitcoin can not be found or created out of thin air, which means its a scarce asset and has the potential to be the most valuable asset in the world.
- Security. Blockchain is tamper-evident and unhackable. If a block gets tampered with, the system rejects it. Cryptography and mathematics are used to regulate the creation of new BTC, making it impossible to create more. Cryptocurrency can’t be stolen or destroyed. Crypto runs on the Internet protocol meaning it is distributed across tens of thousands of computers across the world, and to be shut down, the internet must be down globally.
- Decentralization. BTC is taking power from central authorities and distributing it to the people. There is no single party that controls the software running on the network and uses multiple computers in multiple locations worldwide. Bitcoin blockchain enables distributed consensus and enables trust without trusting another person or party or institution.
- Anonymity. Although Bitcoin transactions are recorded on a public ledger, instead of using your actual name, when you transact using crypto, a record is made without any identifying information using a unique “digital signature.”
- Transparency. If you want someone to track your history, you have the ability to give access to your blockchain that leads to your transaction history (wallet) to a party to review your transactions. For example, buying a house doesn’t require a 3rd party like a bank to prove eligibility. But rather, prove income and assets via your blockchain wallet. Give access to anyone at any time. Close deals faster with transparency.
Should you be investing in Bitcoin?
Bitcoin has the power and is equipped with functionalities necessary to replace the global financial infrastructure and solve world problems.
There are many reasons to buy and invest in cryptocurrencies besides solving the global economic crises, here are just a few more reasons to consider:
- Solves the single point of failure (bank). The public ledger confirms the validity of transactions, unlike a bank or central authority, which means users are in control of their funds, and no one can take it from them.
- It inverts the power structure. It takes power from a 3rd party and gives it to the individual. No matter the age or location, anyone can send payment anywhere in the world.
- Transactions take less time, effort, and fees to send money anywhere in the world. With minimal entry barriers and minimum costs, anyone with a phone can part take.
- An investment opportunity for ALL. Unlike stocks, crypto allows fractional share investments, thus distributing the financial opportunity.
- Unlike fiat currency, Bitcoin has multiple levels of intrinsic value: Productive Capacity and Open-Source Protocol.
- It protects the developing world and is solving poverty. Crypto is a haven and monetary weapon for developing countries who are unbanked or underbanked due to issues like corrupt governments, giving an equal opportunity to own property. For example, bitcoin is and has been a financial haven and weapon for citizens of China against dictatorship.
- It creates global business opportunities. Crypto protects businesses and allows them to accept payments from countries that have high fraudulent activities safely. Overstock.com was one of the first to open its doors to the global market using crypto and now offers international shipping to over 180 countries, while the e-commerce giant, Amazon, only ships to 100 countries.
Conclusion
Remember when Visa cards first came out? It was a payment system we didn’t understand, but very quickly, it became the standard. Change is necessary.
What would the impact be if we all used a global currency that allowed us to pay people anywhere in the world safely, securely, and instantly? Would we be more invested in each other’s success? Would it bring us together?
From landlines to cellphones, dial-up to wifi, bartering to digital currency, technology is shaping our future and bringing change that is improving our lives.
Bitcoin is the next technology to bring a payment system solution, capable of solving the global economic crisis and so much more. Since its inception, blockchain continues to be a source of groundbreaking solutions and possibilities. You must stop and ask yourself, “Is Blockchain the most important technology of all time?”
Find out how to secure your future with Bitcoin.
