BitCoin And BlockChain What Are They?
Have you noticed an increase in the quantity of blog posts, articles and videos talking about Bitcoin and Cryptocurrency recently? I have.
The increasing interest in cryptocurrencies is driven by a complex range of factors which I am not going to attempt to account for in one article, that would be a very long read indeed, and while this might improve the SEO of my site a little bit, I don’t think many people would read it all anyway!
Blockchain is the overarching technology behind all of the cryptocurrencies, so what exactly is this technology?
If we do a little research into Money, and what money is based on we discover that ‘medium of exchange’ is a common factor, money is a symbolic medium that we exchange for goods and services; there has to be ‘value’ underpinning this medium however, and this value can vary!
Valuable items which have underwritten currencies include:
1. Gold – Aubrium is a dense, heavy metallic element which is considered precious by our society because it is quite rare, it has an attractive yellowish hue, and does not appear to react to anything. There is nothing especially valuable in itself about Gold, it is simply that human beings have decided that this metal will be considered valuable, and this is all it takes: mutual agreement of value! There are unique properties in Gold which contribute to it being regarded as being so very valuable, it lasts forever, does not break down or oxidise, it is very ‘heavy’ in the sense that small quantities seem very weighty. Because of this unreactive property Gold has been used in dentistry to fill cavities, in jewelry
Gold is sufficiently rare, but not impossible to find, it is easy to shape into small packages, such as coins, also easy to extract and access from its natural state in nature, easy to verify. Currencies have been based on Gold reserves and to this day underpins substantial parts of national wealth. Silver also is a valued metal, along with Platinum but gold seems to hold its appeal.
A big part of monetary exchange is found in ‘record keeping’ and ledgers, accounting for exchanges of currency provides surety and of course a historical record of transaction. Cryptocurrencies emerged with the advent of the internet, and dispersed networking, the Blockchain is basically a type of Database.
Key differences of Blockchain databases is found in the way they store data, in the Blockchain data is stored in discrete blocks which have a specific capacity, once a block is filled it is closed and then a link established with the very next block, hence a chronological sequence of data blocks is built over time, which can be verified and reviewed much in the same way a ledger can be reviewed.
The surety of each block of data is bound up with the immutable qualities of the data it contains, which assures participants of the validity of this data, it cannot be edited or accessed once it is written to the block and so provides an absolute store of transactional record. Equations are solved by the computers which make up this blockchain database in order to validate the data prior to this being stored forever on each block.
There is of course the proviso that computer networks themselves can prevail through time, if anything were to threaten the electricity supply of our society, such as a massive solar flare or nuclear ‘EMP’ event then all databases would cease to function; Blockchain would then become a beautiful story.
As long as computer networks continue Cryptocurrency will also continue.
Bitcoin is the original cryptocurrency, and various trading exchanges have been set up to facilitate trading with Bitcoin, my own personal experience has been interesting with Bitcoin.
I can verify that the value of an initial investment can dramatically increase, I have seen 1.5% doubling of my original exchange of fiat currency for Bitcoin; of course dips in the market are also expected and have been experienced since Bitcoin was first developed in 2009.
However, in terms of recent developments with substantial players and billionaire investors participating with Bitcoin I think the days of substantial devaluing are behind us; the name of the game is to HODL, which is what investors jokingly refer to, it means to Hold onto your Bitcoin and was a misspelling from a text message: the wise Bitcoin investor will hold onto their reserves, steadily building the account despite fluctuations.
Let the buyer beware, this ancient advice which appears in the Latin as: Caveat Emptor should be taken very seriously when it comes to trading, or investing in Bitcoin or any Cryptocurrency, there is an allure of wealth creation, with stories of cool dudes/dudettes making serious returns on their doh; this is always possible but the best approach is to become familiar with Bitcoin and Blockchain, research widely, and especially be wary of the exchanges. Never invest any more money than you can afford to lose, like don’t go blowing your monthly rent on a gamble, or grocery money, always look after the essentials before investing.
Bitcoin is going to get huge, this I guarantee, all of the signs are that Bitcoin is poised to become very scarce, there is only a finite amount of Bitcoins which are possible, and once these have been ‘minted’ that is the ceiling, it will continue to be valuable but there will be lots of people who wish they had acquired some Bitcoin who will not be able to. Your modest investment today could very well turn out to be your best retirement fund, a few thousand dollars/pounds/yen or whichever is your fiat currency of choice invested today just might be the best thing you ever do. There, you have heard it from me, and I am not the only one who thinks like this. Research this for yourself, never accept what people tell you at face value; from my own personal experience I can tell you that Bitcoin is definitely going to be very big.
Like all ventures concerning investment, there is ‘risk’ involved, there is risk involved with every single aspect of living; even crossing the street is a gamble, but we know the odds are in our favor if we take a little care, this is what investment is also like, shaving down the odds to such a point that we can afford to risk some of our resources so that we can multiply our chances for success.
I wish you great luck, and good fortune.