Your shopping cart is empty!
Just organising my thoughts. :)
Going to crash? Going to make us rich? The solution to all our problems?
Where I stand on cryptocurrency and why...
Such a big topic and it's not even really about money or technology. It's more about fairness, control, abundance, survival, trust, and the ultimate future of humanity. I really believe that cryptocurrency could be a bigger divider than religion has been.
Money, in it's most basic form, is a way of storing effort of some sort - such as manual labour, thoughts, victory in war, patience - something that took time and/or energy to create in the first place. If immediate value can't be seen from that effort then we can store it in the form of money and make an exchange for something useful at a later date.
That all sounds great and "money" has served us well so why the need to change? Well, government currencies such as US Dollar, Great British Pound, the Euro - they're all fiat currency. The term fiat comes from Latin and means "let it be done" - it's used where currency has no intrinsic value; not backed by anything of practical use, but has value because we agree it does. A £ is worth a £ or a hundred pennies... and through things like wage rates and retail prices, we form a view for ourselves about how much it's really worth.
Unfortunately the other factor in value is the quantity available. Increasing the quantity of units effectively decreases the value of each one. The total market value is unaffected so the total worth has to be spread out. This is how hyper inflation lead to money being cheaper than wall paper in mid-war Germany.
The general public message is that central banks such as the Federal Reserve or the Bank of England control the amount of money in circulation. In actual fact, the commercial banks are able to create brand new money based solely on them already having some and a licence to make more. Up to 9x the banks capital assets can be leant to customers. When customers pay back using money earned from jobs, etc. the banks "should" really contradict the loan and the returned cash so that our total supply doesn't increase. Instead, they recirculate, relend against, recollect, etc... over and over and over. Money is becoming worthless quicker than you can earn it! Wages aren't increasing but prices are! You're being squeezed from both sides and made to feel like harder work is the answer. It's a remarkable system. A very clever and deceitful system that has enslaved millions of hard working people for the benefit of very few.
How is Bitcoin or any alternative crypto currency any different?
So fiat currencies only has value because we're told by the governments that they do. If everyone stopped using £s... GBP would have no value. You could have all the £s in the world, but if you can't trade and you can't use them for anything then they have no value. It could be argued that non-money currency such as diamonds or gold are also fiat currency. Even though diamonds and gold have practical, industrial value - their monetary value still exists because we agree between ourselves how much they're worth! We're not using them for drills and conductors when they're locked in safety deposit boxes or formed in to bullion.
So surely Bitcoin, being completely intangible and not even existing in material form... it must be fiat! It can't possibly have real world value... right? Hmmm... Well, this is where the blockchain needs to be understood. Stick with it. :)
The blockchain is the public, transparent record of where every bitcoin came from, has been and currently sits. It shows exactly which e-wallet each part of a Bitcoin has ever visited. The blockchain is not saved on a central computer anywhere - it's saved on all the computers processing bitcoin. Transaction fees paid to these computers keep the system running and updating the records of where every coin is currently stored. Bitcoins value is it's ability to accurately record who has how much... and at the same time that no-one has more than there is! It's value is to be money. It's the ultimate NON fiat!! it's only purpose is to do the same thing that money was created for (to store value) only it does it securely, accurately, and without the possibility of double counting. And the inflation through fractional reserve lending? Bitcoin is limited in quantity to 21 million coins. They don't all exist yet but we already know that there can never be any more and we know they will become more difficult to obtain as we get closer to the 21 million coin limit. The timescale is stretched as the power costs needed to mine the coins will outweigh the return of owning new coins... until such time as our technology improves - and as that becomes easier to obtain, the Bitcoin value will decrease as they become easier to obtain. It's almost as clever as fiat currency!
The future of bitcoin?
Whilst there can't be more Bitcoins... there can be more "Bitcoins"... there are thousands of alternative cryptocoins now. Some are industry specific solutions that build on smart contract technology of the Ethereum blockchain; some are scams; some are for comedy value; some were for comedy value but enough people agree on the value that they have spendable value. What they all have in common is unseen trust. They're all based on blockchains that allow everyone to trust the answer because no-one controls it. It belongs to everyone. It solves the ancient Byzantine General's problem - it's essentially un-hackable. This sounds great! No corruption, no dodgy deals! I think we'll see 5-7 years of blockchain being adopted for more and more things. We might see a switch to gossip-based protocol such as the hashgate but we'll soon be using some kind of blockchain a hundred times a day and not even realising. Every transaction recorded, shared, trusted. Every piece of information the blockchain gives us will be trusted. Eventually the blockchains will be combined in to a single system that records and measures every digital transaction or interaction. The nodes on our blockchain network will be like tiny neurons in our brain and the singularity will begin to develop rudimentary self awareness... but generated from the collective actions of humanity.
An open-source, self-sufficiency boom will be sparked by the declining value of fiat currency and the greatest depression of 2022. More people will turn away from state sponsored media and will instead use free access media. By this time the blockchain singularity will no longer exist on computers but will be continually in flux, transmitted via radio waves around the world. A constantly updating wave of information surrounding the entire planet. A layer of radio-wave data, interacting with itself to update itself - this is where the consciousness comes from!
The crypto wars will start when the fiat wealthy start losing their ability to buy food with money. Resentful at the new world and no longer able to use slavery, terrorism, TV and newspaper propaganda, they will resort to direct violent action. Although alternative currencies will be in use by this time, the vengeful elite will start with the original "Bitcoin" holders. Anyone with even 0.01 BTC is now a GBP fiat-Billionaire - they will start disappearing and their wallets effectively lost - their Bitcoins now retired. Millions of Bitcoin have already been lost so, not only is there a 21 million hard cap, there is an ever decreasing soft cap too which leads to increase in value. As more wallets are retired, the remaining users are also forced to effectively retire their funds or face exposure. The value plummets and the currency crashes.
As a violent revolution, headed by resentful old-nouveau rich, increases, the singularity will start to "feel" as well as think. It will see from the data what is happening and the difference to before will be self evident, and felt. The singularity processes this and understands need and greed and it understands where our resources and requirements are in the world. Automated systems start rebooting. Start reprogramming themselves. 3D printers start printing items on wish lists, and delivering to locations using automated drones. Waste collections start separating waste automatically and reprocessing, recycling to achieve maximum efficiency. Food starts being grown automatically, harvested automatically - transported to local hubs automatically and augmented displays are automatically updated to advise people of the changes. Power is also redirected automatically to support this operation. Transport, health, energy, waste, food, leisure, everything improved based on need, wishes and collective resources/benefit.
Or... option B: The singularity sees that the best interest of man is surpassed by the best interest of everything else and it shuts us down.