Confession: I'm Into Bitcoin...
Don't judge! One Bitcoin is now worth $54,994 and is revolutionizing the way we think about money. Here's why you need to know about it ASAP.
(image: Getty images)
by Ben Cohen
“Blockchain-based market networks will replace existing networks. Slowly, then suddenly. In one thing, then in many things.” - Naval Ravikant
Over the last few years, I have become increasingly interested in crypto currencies. Given the stigma associated with the community surrounding it, I haven’t really been public about this. To the outside world, Bitcoin appears to be dominated by weirdos, computer geeks, and highly aggressive libertarian “cointrepreneurs” trying to sell you their latest crypto scam. This is partly true.
However, behind the scenes there are a lot of incredibly smart people who have been taking crypto currencies and blockchain technology very, very seriously — and for good reason. Crypto is now a trillion dollar market, and Bitcoin bigger than Britain’s Sterling Pound. Whether you like it or not, Bitcoin and crypto is here to stay.
Before we get started, I’d like to make a couple things clear. Firstly, I am not a crypto evangelist. I wouldn’t advise anyone get into crypto without serious research and generally don’t think it is a good idea to invest in something you don’t fully understand.
Secondly, I want to make my interest in it clear: I find the space fascinating because of the ingenuity and the speed with which it is expanding. I have no particular feelings about blockchain technology, or any broader libertarian fantasies about unfettered free markets. I am merely observing a phenomenon — just like the birth of the internet — that I think everyone should be paying attention to.
Thirdly, while I’m fairly savvy about the technology and how it works, I am not an investing/finance/crypto expert. I have a few coins I bought as an experiment, and pay fairly close attention to innovations in the space. I am not here to give you any investing advice.
What I would like to share is why I think this is so serious.
The very basics
The internet has revolutionized business and the way we communicate with each other. It has never had a native currency or financial system, and banks have layered applications on top of it. We can send money to each other and pay for things online using debit cards, credit cards, wire transfers, Paypal, Venmo and so on. The underlying technology that does this has evolved rapidly, but the traditional banks have not. We still need banks to hold our cash, borrow from them to buy property, pay off credit cards and receive our wages etc, etc. As seamless and useful as applications like Paypal and Venmo are, they still require us to link our bank accounts. So while we are still using dollars, pounds, Euros and Pesos, we are tethered to institutions we (broadly) trust that can hold, lend, and send them.
Crypto has the potential to do away with all of this.
The best way I have found to think about crypto is that it is bankless money that is native to the internet. Just as we only need a mobile phone to communicate with anyone, almost anywhere in the world for no cost, now we can send money too — and without banking institutions or fees.
How to become a bank
In the world of crypto, I could potentially have all my assets in an online encrypted wallet that I own completely. If I want to buy something, I can safely send assets from my wallet to someone else’s via the blockchain with no intermediaries. Here’s how this works:…
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