Bitcoin(Cryptos) vs. Normal Currency | Things Are About to Change!

Posted at October 3, 2017 by admin on category Bitcoin News

Hi welcome to another ColdFusion video by now you’ve probably all heard of Bitcoin cryptocurrencies and the blockchain it’s received a lot of press lately Bitcoin Bitcoin bitcoins bitcoins Bitcoin Bitcoin Bitcoin it’s all the rage but what the hell is it in this video we’ll go over how these new systems compared to regular currencies and also briefly look at how they work I want to start off this video is something that happened recently it’s the clip of the Federal Reserve chairwoman Janet Yellen getting grilled by Congress for the Federal Reserve being shady as usual this kind of thing is normal in this situation something unusual happens what closely well we don’t have a lack of transparency I observe can’t out of it that’s the lack of transparency so I regard the Federal Reserve is one of the most transparent central banks in the world we that’s a state lien what this is a great picture of the condition of the old monetary world versus the excitement of what could be the new monetary world the blockchain and crypto currencies came in the wake of the frustration felt by the world after bad monetary policies from central banks like the Federal Reserve commercial banks and hedge funds also had a large part to play it just had to be another way a way where people had control over their own money again all right so to begin what are cryptocurrencies broadly speaking it is a form of currency that is built on a global digital distributed ledger called a blockchain I’ll get Luisa whom I met of the st. Gallen symposium in Switzerland to explain and then we’ll break down the terms that she says a bit later hi my name is Louisa and I work as a research assistant at the text and fiscal law department at the University of Graz in Austria and this topic of my PhD is the succession issues arising from the use of cryptocurrency Bitcoin is is a crypto currency as I say it’s the most famous the currency is not the only one but it’s becoming more and more popular it was invented in 2008 but with the release of the white paper by Satoshi Nakamoto which is the inventor but it feels like unknown so we don’t really know with this their characters of this to talk already so basically if I have to do an analogy maybe for ability search understand as the currency so something I used for paying services or goods but it’s very different because um the first things that seem to irrelevant and Bitcoin is that is the centralized so it works with photography and in my network composed by different computer as nodes and it’s the centralized meaning that there is no central bank or government behind all the current you are like in charge of the monetary policy of this currency all the transaction I parent are verified through the network every transaction is registering a ledger a public ledger which you can find online so easy to to go through it and we just call it up chain so all the transactions are recorded there you can eat before we break things down it’s important to note that crypto currencies like Bitcoin and cerium and others are distinctly different from the digital fiat currency in your bank account we’ll take a look at the differences using Bitcoin as an example Bitcoin unlike a regular currency has a cap supply of 21 million coins in this way it’s similar to gold another finite resource that can be used as money as time goes on the Bitcoin can be divided up into smaller and smaller units as the economy grows with traditional digital fiat currency there is no telling how much money is circulating and no one knows if the central banks will decide to start printing more money this can be a real problem depending on how you view economics this is what I mean there are two main schools of economics the Austrian school and the Keynesian school the Austrian school thinks that money printing is a silent robbery by inflation as it makes us poorer because the more money there is the Lesseps works the Keynesian school actually thinks inflation is a good thing in our world most of the central banks are run by Keynesian and today instead of focusing on GDP growth and wealth creation they focus on inflation they actually want a steady-state inflation of 2% per year in contrast Bitcoin and other cryptocurrencies are deflationary because there’s a fixed amount making it worth more over time instead of less so why are these new digital currency is called cryptocurrencies simply put it’s because they use a form of mathematics called cryptography this allows participants in the system to have a unique address called a wallet kind of like a bank account only the individual has access to their wallet this personal digital address or wallet mathematically proves that money sent or received to this wallet is actually going to the right person a wallet can be mathematically checked for accuracy but can’t be altered or tampered in any way so what is a blockchain in basic terms of lock chain is a decentralized peer-to-peer system in this system millions of computers agree on a global record of the history of all transactions that have ever taken place in the system this global record is called a ledger when you transfer some money or a service on the blockchain everyone in the system knows about it if it’s easier you can think of it like another peer-to-peer service like LimeWire or torrents where instead of transferring files you’re transferring a transaction entry into a very long notepad of all transactions and the notepad can be seen by everyone because there are millions of computers keeping track of all the transactions this makes it impossible to cheat and create multiple fraudulent bitcoins the computers that are looking after the ledgers and keep the system running are called miners they use their computers to solve complex problems of how the transaction should be put together each time a problem is solved is called a block and each block holds ten minutes worth of transactions and is put in the chain when it’s completed hence the name blockchain the miners get rewarded in cryptocurrency for their efforts this is how new Bitcoin is created this is all modeled on how gold is mined out of the ground since the activity of mining actually costs electricity to do Bitcoin is seen as an actual electronic unit of work by some analyst we’ll look at the blockchain in the future video but this underlying technology will be one of the most influential inventions of this century some analysts such as dan Tapscott are putting its significance above that of AI hailing it as a second internet the much smarter the technology likely to have the greatest impact on the next few decades has arrived and it’s not social media it’s not big data it’s not robotics it’s not even AI and you’ll be surprised to learn that it’s the underlying technology of digital currencies like Bitcoin it’s called the blockchain block chain to give you an idea the etherium blockchain is theoretically capable of running entire companies and services like Airbnb automatically with that human input while also automatically optimizing company performance the blockchain also behaves as an automatic auditor and accuracy check throughout the whole system it’s just part of how the blockchain is designed in this way Trust is actually built into the system it all sounds crazy but as far as I’ve looked into it I think it will have an incredible impact on our world I’ll be getting dr. Adrian McCulloch one of the world’s leading experts in blockchain technology law to talk with us in the future episode ok so with that out of the way what are some advantages of crypto currencies because crypto is our decentralized currency no central entity regulates or controls it there is no middleman be it a bank government or any other company with normal currencies when you have a middleman they usually aggregate power and aid in wealth inequality this happens all the time today for example a lot of the wealth created it goes to those closest to the financial industry banks and those in the derivative markets etc another advantage to being decentralized is that it’s harder to hack thanks and other centralized powers are an easy target for hackers and have been hacked in the past the blockchain on the other hand is impossible to hack because the hacks just one block you must hack all the previous blocks in that system’s history plus all the millions of computers at the same time around the world impossible with today’s technology but you may be thinking I’ve heard of their claim being hacked on the news the hacking was actually at the exchanges web sites where you can buy or sell crypto currencies this was the interface between the blockchain and the normal internet the actual blockchain has never been hacked and other advantage is that there’s a low barrier to entry anyone can join you don’t need a bank account or permission from a government or any other entity or even have to pay a fee all you need is an internet connection and the software this is great for a few reasons it means that individuals in financially oppressed countries such as China and crisis countries such as Venezuela can get their money out without being tracked in contrast in today’s currency system it’s hard to get your money out in these situations for example the Chinese government has been cracking down on capital flight so worried investors in China are buying international property at any price just as a way to store their currency of course this causes other problems like property bubbles in the countries that they’re buying property in addition to this transferring cryptos internationally is faster than traditional methods taking ten minutes instead of days because actually what it was supposed to over the blockchain I it’s very efficient in terms of cost and how the transaction that transaction much faster than they give a once money to you it will take from your toes rail yeah a couple of days probably maybe one two days they’re very lucky and it works very well there is just like ten minutes so of course it’s it’s much more efficient so that’s why I also like commercial banks and financial institution are exploring the option for under property so they’re all these music another interesting advantage is because the blockchain is transparent and everyone in the system knows which transactions are going to what wallet crypto currencies can help stop corruption in developing nations so in conclusion it’s clear that block chain based currencies have some attractive advantages over our regular financial system a lot of governments have taken interest and China has actually announced that they’re going to be testing their own blockchain based currency I must add that am NOT a fan of a centralized government having control over a crypto currency many banks and companies are also implementing the blockchain the city of Zork in Switzerland is actually implementing a blockchain based ID system and there’s many many more stories around the world of blockchain being implemented with this all being said this area is just so new that no one knows for sure what the downsides could be yet just as an example Bitcoin may have failed due to some unforeseen problem but I think eventually there’s going to be a cryptocurrency that’s going to get it right whether you think this is a good or bad thing there’s no denying that the blockchain and crypto currencies are definitely going to shake things up this video was just a bit of a teaser of what’s to come I’ll be hoping to do a lot more videos on this topic and go into more detail about what’s happening with this revolution around the world but before I go I guess there’s a lot of you that will be asking the question should you invest in Bitcoin and other cryptocurrencies well the answer depends on you what are you actually looking for are you in it for the long term a actually treating cryptocurrencies as a store of value in case of a crisis much like gold with this strategy people usually just buy when the price goes down but always accumulate more and never sell until years later when they want to get out another group of people of the speculators speculators are the ones that just want to make quick cash this is probably the hardest strategy because cryptocurrencies are actually a real free market not influenced by financial instruments so it is going to be a wild ride to do this successfully you’d have to read all the news about the cryptocurrencies that you’re investing in and know about the technical details such as hard Forks you’d really have to proceed with caution with this because people that don’t know what they’re doing are bound to buy and sell at the wrong time are you in another category where you’re in a crisis country and just need some financial freedom obviously I’m not a financial adviser so I can’t tell you what category you belong to or how to invest but I can leave some resources for you to get started in the description anyway there’ll be much more on the cautionary side of crypto investing when I speak to dr. Adrian we both agreed that there is the elements of high PR and it’s going to be like another calm era where there’ll be a frenzy of investing a market crash and only the real crypto currencies will survive much like the googles and Amazon’s of the dot-com era so I guess that’s it thanks for watching this video hope you got something out of it hope you found it interesting this is a really hot space at the moment and I think we’re really witnessing the beginning of something this has been to gogo you’re been watching cold fusion if you need to this channel feel free to subscribe cheers guys have a good one and I’ll catch you again soon to the next video [Music] [Music] [Music] coldfusion are you thinking

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