I’ve dived deeper into the crypto world the past few months. I’m still new, but my curiosity is snowballing and I’m nothing but rooting for a decentralized currency to permeate the planet and free the individual.
To continue my self-education, I started reading Steve Patterson’s What’s the Big Deal About Bitcoin, which is a great introduction to the layperson.
Here are my book notes for Part 1 and 2:
- Bitcoin is a both a software and a currency
- Bitcoin the software is a public, online ledger. All bitcoin currency transactions are viewable and verifiable by anyone
- Bitcoin advantages include:
- Secure – not dependent upon third party – can send/receive directly to anyone on the planet
- Scarce – 21 million bitcoin is all that will ever exist, avoiding inflationary risks
- Decentralized – no group owns the ledger – this is mathematically built in to the system
- Divisible – the smallest unit is 100,000,000th of a bitcoin
- Portable – a smartphone does the trick
- “Owning bitcoin” really means owning the private key to bitcoin stored in the ledger
- Bitcoin solves the “double-spending” problem of earlier digital currency attempts. It is impossible to fraudulently try to “re-spend” funds which have already changed owners.
- The Bitcoin software is programmed to gradually reduce the size of the mining reward until it is completely eliminated in the year 2140.
The future is exciting with possibility, like the internet in the 1990’s. Patterson notes:
“A now-legendary article was written for Newsweek in 1995 entitled ‘Why the Web Won’t Be Nirvana.’ The author laments the chaos of the internet and is entirely unconvinced that business will ever happen online. He wrote:
“Every voice can be heard cheaply and instantly. The result? Every voice is heard. The cacophony more closely resembles citizens band radio, complete with handles, harassment, and anonymous threats… How about electronic publishing? Try reading a book on disc. At best, it’s an unpleasant chore: the myopic glow of a clunky computer replaces the friendly pages of a book. And you can’t tote that laptop to the beach. Yet Nicholas Negroponte, director of the MIT Media Lab, predicts that we’ll soon buy books and newspapers straight over the Internet. Uh, sure…“”
There’s still risk with cryptocurrency. But with the Fed printing trillions of fiat dollars, it may be the safer option.
That’s all for now!
