[MONEY] What is Cryptocurrency?
Gen-Xers and older don't really understand cryptocurrency unless they're tech geeks. I am NOT a tech geek but I've been scouring the internet for a basic understanding of what it is, why it's hot, and why I feel like I need it.
Let me premise this by saying I am not an expert. I'm just sharing some of the information that I've found and translate it to the best of my ability for those who need baby steps toward understanding the hype and WHY it's important for our future monetary stability.
No Central Banks, Please!
Okay, so I'm not a fan of anything BIG: Big Pharma, Big Agri, Big Banks, etc. I believe it chips away at our basic rights as human beings. I'll save the whole spiel about my opinions on those on another date. But here's the thing that I know and understand about cryptocurrency: According to Gavin Andresen, a lead developer for a part of the bitcoin digital currency project, it is a "decentralized currency of the people."
And as a side note, if you want a butt-load of information about Bitcoin, read his blog.
Central Banks
Did you know the Federal Reserve was privately owned? Just because it's labeled "federal" doesn't mean it's government. Much of it is independently owned through stocks by member banks. Those stocks will never be available to the average person like you and me because according to the FED, its stock may not be sold, traded, or used as equity for a loan. WHY would anyone want that kind of stock? Because the dividends are set at 6% per year, which may not sound like a lot but to get a sense of what that means 6% of one Trillion dollars equals 60 Billion dollars.
Not you or me, that's for sure. Not when Joe and Jane Public pays upwards of 24% apr on credit card debt issued by BIG BANKS. You thought you were in control? Go ahead and laugh because the alternative is crying. When centralized banks get into trouble, they can print money, which devalues it.
Read Anthony Migchel's article: Does Rothschild own all Central Banks?
The beauty of cryptocurrency
The more I read about it, the more I feel like a pirate hunting for treasure. You see, cryptocurrency has no centralized repository where cash or precious metals (gold & silver) are stored. There is no government oversight. There is no law enforcement. There is no global jurisdiction. What you earn or farm cannot be seized. It belongs to the people, and you may remain anonymous should you choose to be.
It's open source, which means that it's available to everyone. It can be shared and modified. It is also transparent enough where anyone with the know-how can keep an eye on it to make sure it's doing what it's supposed to. The people hold it accountable and the value is mathematically-based - not reliant on precious metals and the whim of private owners.
Your currency is fluid and based on the age-old premise of supply and demand.
What is a block?
A collection of all the transactions completed within a specified amount of time.
What is a blockchain?
Blockchain is geek-speak for ledger. It is a list of the blocks that have been mined
If it's open sourced, how is the currency protected?
Miners take a block of transactions and feed it through a mathematical formula, which then converts it into somewhat randomized keys, which is then stored and logged with the block. Okay, I may have confused you a little. The best generic interpretation I can come up with are QR codes. To look at it, you don't know what it's for until you scan it, right? Each key (or hash) is created as a sort of front face to the block.
There is a naming convention of sorts, so if anyone tries to tamper with the blockchain - even by one number or letter - the following keys are going to be wrong. The beauty of miners and the process being open source is that fakes will be spotted very quickly.
Final Thoughts
I cannot express enough how little I know about cryptocurrency, but I hope that my research has been helpful in learning more about it. If you are "in the know" and see that any of my information is incorrect, kindly let me know so I can rewrite it. My hope is to help the layman better understand the tech-speak and get everyone excited about cryptocurrency. Frankly, I love the idea of being in control instead of allowing a choice few to determine my financial future.
If you found my article helpful, kindly vote up and leave me a message!
Meredith Loughran blogs at ScribblingBandits.com | Follow her on Twitter & SnapChat or LinkedIn
Some of my other articles:
Upvoted
thank you @countrytalented :)
I've been really interested in crypto currencies lately and in doing many (many) hours of research, I stumbled over something called "Holochain". Basically it is a (truly) decentralized p2p internet/app platform. It is all about facilitating interactions and building communities. Check out this awesome interview with one of the developers, he explains things very well.
They also have a very strong and interesting community chat on Mattermost.
Ps. 94% of Bitcoin is held by 4% of its holders...
:)
Thanks for sharing this! I've bookmarked the YouTube video.
I'm still mad at myself for NOT saying YES over 10 years ago when a few people said they'd give me a couple bitcoin just to open a wallet.
I followed and upvoted. Please follow, comment and upvote back. Thanks!
Okay, you almost have me, but I still need to do some more reading I think! But so far I'm all in on the decentralized part too!
Great article. Thank you so much.
Hi! This post has a Flesch-Kincaid grade level of 9.2 and reading ease of 59%. This puts the writing level on par with Michael Crichton and Mitt Romney.