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Last year we saw the biggest decline in the economy since the Great Depression. However, we saw early signs that the global financial system was migrating towards fast-growing digital asset markets.
To really understand crypto we have to start over. Bitcoin was invented by a person identified only as "Satoshi Nakamoto" in an October 2008 whitepaper. Working with a crypto mailing list, Satoshi Nakamoto launched Bitcoin (an electronic version of money that verifies its transactions through cryptography) on January 3, 2009. Its unique identifier was the peer-to-peer system that could not be controlled by any government or person.
This wasn't someone's first attempt at developing forms of electronic money. Hashcash and Digicash were two projects that preceded Bitcoin. However, they couldn't solve the double spending problem, which means that people could spend the same money twice. Bitcoin's solution was to introduce a permanent, timestamped ledger, namely the blockchain. This makes every coin unique and traceable, as the transaction history of every single Bitcoin is publicly visible in the Bitcoin blockchain network.
Recording technology is decentralized, which means that no single group is in control, creating the opportunity to transform the world's financial institutions and companies, resulting in safer transactions and more decentralized money.
Bitcoin explained (simply)
When you buy some form of digital product there is usually an “unlimited” supply (for example, if you buy a movie, song, or game online, the company can sell as many copies as it wants). Blockchain, Bitcoin technology based on, makes it so that each Bitcoin can only be held by one person at a time. It is the first digital asset that has a set offer. This makes it the first digital asset. Just as a Van Gogh is valuable because it is unique and copies of it are worth next to nothing, especially digital copies, so any bitcoin is valuable in itself because it cannot be replicated, so a digital asset can assume astronomical value. It is most similar to digital gold. Gold is valuable because of its fixed supply and the fact that you can transfer it. Bitcoin has a fixed supply and is even easier to transfer and store.
With this technology, you can trust someone in the digital world. They can send you data, documents, payments and much more that is 100% verified by the technology that makes Bitcoin possible (this is known as blockchain technology). Blockchain technology creates a network in which everyone in the network constantly checks and secures every transaction. This is the revolution. Security and trust are guaranteed by everyone who uses the network. This opens up the possibility of decentralized banking, insurance, social media, video platforms, etc. where there is no company to keep the profits for itself or control the ecosystem. Instead, the ecosystem can be controlled by the users in an open, transparent and trustworthy way. This means you can have a video platform where user privacy is proven to be safe, a bank that guarantees users are getting the best possible deal on savings accounts or investments, an insurance company that has no overheads, and much more.
Should You Invest in Bitcoin?
This is the first digital way to take away the power of governments to print money and control currencies. This comes at a perfect time when so many governments are printing endless amounts of money and artificially propping up stocks. Digital assets have transparent and immutable monetary policy. For example, if you put a US dollar into a savings account at a bank, you don't know where it's going. You get 0.25% to 1.25% interest at best, and the US dollar itself is controlled by the Federal Reserve and the government. When you deposit bitcoin on a decentralized lending platform, you can see where your bitcoin is going and what is happening with it. You get a 3-12% return on investment (there are no sellers, no marketing, no stock dividends, no profit distribution because everything is transparent and verifiable) and you can even have future products and upgrades to the credit platform. Also, the Bitcoin you place on this platform is not controlled by anyone and you know what their monetary policy will be forever.
Related: Why Small Businesses Should Consider Bitcoin
If we compare Bitcoin to gold, they are both scarce assets that are used to hedge against stocks and currencies. Grayscale, Square, Paul Tudor Jones, Fidelity and many other major investors use Bitcoin as security. Bitcoin is better than gold in crucial ways: easier to transfer, easier to store, immutable and transparent (the supply increases are preset and immutable), a digital currency for a digital world and limitless. However, Bitcoin's market capitalization is 96% less than that of gold (around 9 trillion for gold and around 300 billion for bitcoin). With that in mind, Bitcoin and the rest of the digital asset space have a high cap to grow to the size of traditional competitors.
Blockchain offers transparency
This decentralized system involves compromises. Bitcoin and blockchain technologies have been labeled as being used for malicious activity and “for criminals”. That narrative is starting to change, but blockchain is still an emerging space. One problem has been blockchain tokens and companies formed with anonymous founders just to scam users. We want to change that narrative and show that small startups can get started in a more transparent and sustainable way.
I co-founded a transparent project called xBTC that shows how people can permanently and legitimately build businesses in the new blockchain space. These types of projects define digital assets and bring them into the mainstream. You will develop products that can be created quickly and take advantage of the technological advantages of blockchain while being trusted and used by millions. xBTC and other projects start new ideas and create new technologies while being transparent and open. This enables digital assets to grow and creates a brighter future for the entire space. The many scams and anonymous founders create and perpetuate the narratives of digital assets used for illegal activity and abuse.
Related Topics: How To Buy, Sell, And Track Bitcoin
Digital assets enable the democratization and decentralization of technology and startups. Anyone can quickly and easily start a new technology and business from scratch. Many founders and projects have abused this system by creating fake websites, products or business plans. You will then receive tens of thousands, and sometimes millions, of funding from users around the world. By staying anonymous and doing everything digitally, they can run away with funds raised and leave the project behind with no recourse to the users.
How do I buy Bitcoin?
The easiest way to buy digital assets is with large brokers like Coinbase or Gemini.
The future of bitcoin
When we see governments begin to officially regulate digital assets and large financial players enter the room, it shows a bright future for Bitcoin and other cryptocurrencies. Just a few weeks ago, France enacted clearer regulations on crypto, Microstrategy spent over $ 500 million in convertible bonds to buy bitcoin, and MassMutual bought $ 100 million in bitcoin. Within 24 hours, the Greyscale Investment Fund bought more than 1,000 bitcoins and more than 100,000 Ethereum. This has only been a week of news. The big institutions and actors are just starting to get involved in the field and this will only add more capital and legitimacy to the digital assets. This movement of more traditional actors and governments into space means that it is becoming more accepted and more trustworthy. Just like Bitcoin, the entire digital asset space has a combined market cap of less than 500 billion. We are still in the early growth cycles of an emerging and globally changing technology. At xBTC, we are betting that other digital assets will overtake Bitcoin as they revolutionize banking, insurance, gaming, social networks, consumer goods and more. We make it easy to buy and speculate on bitcoin dominance. Bitcoin is just the tip of the iceberg for digital assets, and there are so many more innovative assets in space. We believe that Bitcoin Dominance will be an important indicator of this future.
Related: Bitcoin News & Topics – Entrepreneurs
Bitcoin is groundbreaking and will continue to change the world. However, an even bigger revolution will come from blockchain technologies that distribute assets, currencies, savings accounts, insurance protection and much more in a decentralized way to billions of people around the world.