In 2009 5000 bitcoins – that so-called virtual currency – cost 27$.
In 2013 – almost $800,000.
In 2017 – 50 million dollars.
Now in 2018 1 Bitcoin costs 6.669$.
From 2017 till now the price has got down a little bit but it’s still high.
We are talking about the market deal of 450 Billion Dollars. Let’s admit this technical revolution is not less important than the Internet revolution.
Jobs of financial institutions and even some countries are under threat. Some researchers said that the technology of BlockChain with a little pessimism can wipe out the biggest institutions in the world.
In 2008 a lot of financial institutions that we trusted got down in the economic crisis. Lehman Brothers bank got bankrupt. That bank had property estimated in 600 Billion dollars. This Bank was the 4th biggest investment bank in the United States, and a lot of banks around the world had the same crisis. It was the biggest economic crisis in the world history. Even some cities like Detroit and some countries like Italy and Greece were threat to getting bankrupt.
Here the story began.
Satoshi Nakamoto – creator of Bitcoin- created new and a unique type of currency intangible. It was revolutionary.
Bitcoin is a digital currency extracted with specific rates when a computer solves difficult math problems. This process is called mining.
You will have an account with the username and password. No one should know them except of you. When you want to transfer money to someone, it’s done with the operation approval. Moreover, this transaction is recorded in a million of computers around the world. Plus, it is indexed in a block and put in a chain which contains all the transactions happened in the history.
To make it easier to understand:
1 – The currency is transferred immediately, although it takes banks a day or two plus percentage to do the same thing. It’s a very important point
This market is estimated in $600 Billion (not included in formal ways). There are 2 Billion people on the planet who don’t have a bank account.
In 2013 this kind of transactions represented 1/3 of the Nepal economy. In 2009 this transaction represented 1/8 of the Lebanese economy. There are 10 million Lebanese people who live outside and 4 million who live inside the country.
2 -These transactions are indexing not just in one computer but in millions of computers around the world. So, if you want to hack these computers you need 40 times more power than Google – the biggest search engine in the world. It’s almost impossible to reach that level.
All the world knows that a transaction was conducted, but nobody knows who did it. This idea makes the Bitcoin’s creator very rich, just like the price of bitcoin nowadays.
In 2009 Bitcoin was less than one dollar, now it is $6669. Moreover, because of the fact that it’s limited – 21 million bitcoin – it is like gold. That means, when you have 1 Bitcoin, you have 1/21 million from the world Bitcoin fortune.
If you are surprised by that invention, I’ll tell you there is one more.
They simply joined smart contracts with the Blockchain technology. Lots of computers around the world ensure that terms were included in contracts. It’s a very smart idea.
This feature threats Governments’ authorities. It is Government’s Job to have judicial system that ensures legal contract terms. Most of the time Governments monopolize that.
We don’t know if Bitcoin or blockchain will replace banks or governments. But what we know is that the invention of the blockchain technology (the information in many computers around the world records the data about transactions or terms and no one is able to change the information that was indexed) is not less important than the invention of the Internet.
Some countries approved Bitcoin, e.g. Japan. Economy of some countries like Kenya depends on the Crypto currencies or Digital currencies for over 50%.
In some countries like Afghanistan, girls aren’t allowed to have a bank account, that’s why they turn to Bitcoin.
The United Nations sent the Economic Aid to Syria with Ethereum.
Leave your comments below on what you think about Bitcoin and crypto currencies: Are they a threat to the Government’s power and authority or not?