How Cryptocurrencies Like Bitcoin Can Democratize Money and Society
As cryptocurrencies like Bitcoin break new records seemingly every day, could this lead to a financial and cultural revolution? Or are we not quite there yet?
Cryptocurrencies have recently gained popularity as an alternative to conventional monetary systems. Blockchain is a system in which a record of transactions made in Bitcoin and other cryptocurrencies are maintained across multiple computers that are linked in a peer-to-peer network. Cryptocurrency has no centralized bank controlling the flow of money, but rather a decentralized system controlled by algorithms.
Crypto has been hailed as a way to democratize finances for all, not just wealthy elites. But with the rise in popularity, what are the potential pitfalls of these online currencies?
“Blockchain is a way of digitally marking the development and moving around of this money—you’re making sure that it can’t be counterfeited. They do it in such a way that it’s anonymous and decentralized, but secure,” Zeus Yiamouyiannis, author of Transforming Economy, said.
“The current monetary system can be manipulated; the supply can be manipulated to benefit very few people over the many. As we’ve been seeing over the past few decades, the same pattern keeps emerging and it’s growing, and that is greater and greater gambling by the big boys, to the point where they inherently fail through their greed. And guess who bails them out 100 percent of the time? The little guy who had absolutely nothing to do with it,” Yiamouyiannis said.
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5 Blockchain Applications That Could Change Society Forever
When most people think about the term “blockchain” their minds immediately go to cryptocurrency and bitcoin, but in reality, there are many different blockchain applications. As this technology continues to gain traction, it’s myriad uses will be used to solve and improve upon many institutions in our society from voting, to real estate, and electronic gadgets. So what is the blockchain exactly?
The Blockchain Explained
The concept of money is based on trust, or faith, in the system. We’ve all agreed that a centralized authority, in this case the government, will maintain stability in regulating money so it can be used as a tool for trade. The same goes with contracts upheld by law; a centralized institution is an arbiter that will make sure the terms of your contract are upheld. But with blockchain technology, that power can be distributed throughout many disparate entities, rather than one centralized authority, making it so that one entity can’t have all the regulatory power.Â
The blockchain, also called distributed ledger technology, is essentially a digital database managed by a decentralized system, consisting of a number of different computers, in lieu of a single centralized server. These different computers are referred to as nodes and all of them are connected in a randomized way.
