Why do People Need an Alternative Currency?
In this day and age, you would be hard pressed to find a world that was more divided compared to the world that exists today due to the advent and popularity of cryptocurrency. The reason for that is that the exact nature to many people remains mysterious and unlike conventional currencies it is decentralised making it good for use in multiple ways like holding investments for trading etc. Many people often ask the same set of questions when being confronted about it namely what it is, how does it work, who regulates it, how is it different from normal currencies, what market drives its price, is it legal, is it anonymous and how to get it. If you would like to read more about cryptocurrencies visit this article.
The major question addressed today is that people need a decentralised currency more than ever and todays and nowhere is that more apparent than today. One of the greatest financial crises in America since the Great Depression was caused by the problems of the currency regulation today. Since it is caused right now by the greed and irresponsibility of the worlds greatest and biggest banks. This crisis led to one of the worst periods in the history of the United States namely it was called the unemployment crisis and the wealth lost by people in this time was lost multiple times later and continued on for several more years after that as well.
One of the biggest crises that followed on from that was the Greek financial crisis and that led to a situation where a Greek citizen could not even withdraw their own money because the government had forcibly locked down the assets of the individuals in order to make sure no one could withdraw since funds where needed in order to pay off the debts that Greece has accumulated over the years.
Have you never thought about the irony of the situation where you actually place your faith in institutions and the government itself to handle your money and by the end it they themselves who let you down in the end because of the fact that they mismanage their own resources? Well you might very well say that you do not care since your government and banks are strong and a situation as extreme would never be occurring where you live or are currently living.
However, what if I told you that was not totally true. While it might hold true that your country is not currently in that bad of a situation that might soon change because of the fact that eventually there could be a declaration of what or there might be problems etc. Countries can be on the brink of war soon. This is one of the best ways to invest your money currently and you can start buying bitcoin with a credit card and utilising the power of the blockchain today.
The internet has brought with it the necessary disruption and therefore it has been able to reveal information and make it accessible to normal individuals along with those who created it. Since most of the worlds banks are currently following the old banking systems and methods and so the transfer of value has been made extremely costly as a result of that. Transaction fees of ridiculous amounts such as 30 dollars are not uncommon and that makes the job of the common man much more difficult. If you would like to read more about banking visit this article.
However, what if I was to tell you that there was a method whereby it could be possible to reveal information as well and also reveal or democratise the value exchange market at the same time. The way to do that is cryptocurrency more specifically Bitcoin. Cryptocurrency in general and on its on along with the methods that they are used with are called the blockchain.
Bitcoin was started in January 3rd, 2009 by an individual or individuals under the assumed name of Satoshi Nakamoto. Notice clearly how the date of the creation is almost immediately after the 2008 financial crisis.
The peer to peer payment system that bitcoin holds today maintain that there is no single central authority who can actually ensure that every transaction in the system is valid today. Since each of the transaction is validated through the process of mining. This is part of the bitcoin system and this consensus protocol is called the Proof of work system to verify the transactions and it needs every single participant in the mining process to make sure that computational cycles are spent and complex arithmetic and crypto puzzles are solved to generate the currency. Since it can be difficult to understand exactly what people have to gain by wasting the power of their CPU and the electricity.
The answer to this part is actually interesting. The mining protocol once successfully fulfilled can reward the person fulfilling the protocol with bitcoins. This is how they are generated and released into the system and the complexity of the puzzles retains a hold on the amount that can be released since they are fairly challenging and can only be done by individuals who are smart enough to do them. If you would like to read more about banking visit this article.
No specific entity of organisation is actually responsible for the regulation or backing of the cryptocurrency. While that might scare you, it is not as bad as you might think. Also, the hacks on bitcoin that take place are also good because of the fact this was not due to a weakness in the blockchain structure itself but due to human error that ended up affecting the ways in which blockchain was handled. The mechanism itself is not problematic and the only way you can tamper with the system is if you have a super computer available to you.
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