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How Cryptocurrency Will Change the World

Author: 
Kyle F.
Date: 
August 08, 2018
Read time: 
6 minutes
History
Cryptocurrency
Fundamental

Peoples’ thoughts and opinions regarding cryptocurrency vary wildly. Depending on who you ask, Bitcoin and the altcoins that came after it can be described as anything from worthless and speculative to truly paradigm-shifting. Generally, we can group people and their beliefs about cryptocurrencies into one of three levels of confidence:

  1. Complete lack of confidence in cryptocurrency. These people believe that the technology is either useless or that it will never stand a chance at mainstream adoption because things like regulations and government intervention will prove to be insurmountable.
     
  2. Moderate confidence that cryptocurrency will earn a place in this world. This second group sees cryptocurrency at face value. Yes, it can be used as a storage of value, a method of exchange, and for some other utility, but its ability to create real change is minimal or moderate, at best.
     
  3. Complete confidence in cryptocurrency to change the world. True crypto believers see blockchain technology and the cryptocurrencies built on it as revolutionary; these diehard supporters believe the world is destined to be changed by cryptocurrency.

Individuals in Group 1 and Group 2, beware: this article is written from the optimistic perspective of Group 3.

It might seem unlikely at the moment, but people that have a real understanding of blockchain technology know that cryptocurrency isn’t going anywhere anytime soon. It is not going to fade away and it cannot be stopped. Sooner or later, cryptocurrency will change the world

Peoples’ thoughts and opinions regarding cryptocurrency vary wildly. Depending on who you ask, Bitcoin and the altcoins that came after it can be described as anything from worthless and speculative to truly paradigm-shifting. Generally, we can group people and their beliefs about cryptocurrencies into one of three levels of confidence:

  1. Complete lack of confidence in cryptocurrency. These people believe that the technology is either useless or that it will never stand a chance at mainstream adoption because things like regulations and government intervention will prove to be insurmountable.
     
  2. Moderate confidence that cryptocurrency will earn a place in this world. This second group sees cryptocurrency at face value. Yes, it can be used as a storage of value, a method of exchange, and for some other utility, but its ability to create real change is minimal or moderate, at best.
     
  3. Complete confidence in cryptocurrency to change the world. True crypto believers see blockchain technology and the cryptocurrencies built on it as revolutionary; these diehard supporters believe the world is destined to be changed by cryptocurrency.

Individuals in Group 1 and Group 2, beware: this article is written from the optimistic perspective of Group 3.

It might seem unlikely at the moment, but people that have a real understanding of blockchain technology know that cryptocurrency isn’t going anywhere anytime soon. It is not going to fade away and it cannot be stopped. Sooner or later, cryptocurrency will change the world

 

Understanding the Difference Between “Blockchain” and “Cryptocurrency"
 

Despite the fact that  “blockchain” and “cryptocurrency” are used interchangeably, it is important to understand the distinction. For example, we could say “Blockchain will change the world,” or “Cryptocurrency will change the world.” Most people who agree with one statement would agree with both, but blockchains and cryptocurrencies are two separate entities.

Source: capitalgroup.com
 

Blockchains are ledgers, or lists of transactions, that are stored digitally and distributed amongst a network of computers. When we say that blockchains are “decentralized,” we are explaining that these distributed ledgers are not stored in any one place or controlled by any single authority; instead, they are available to anyone that wishes to view them. Blockchain is best utilized in a decentralized environment.
 

Cryptocurrencies are digital currencies. The reason that “blockchain” and “cryptocurrency” often get confused is that almost all cryptocurrencies use blockchain technology as their backbone. To date, there are thousands of different cryptocurrencies that offer different features and operate for different purposes. At their core, though, most cryptocurrencies share two main characteristics:

  1. Blockchain technology. Almost all cryptocurrencies use blockchains.
     
  2. Decentralization. Cryptocurrencies are usually considered decentralized; they are not controlled by singular authorities.

Now that we’ve taken a step back and separated blockchains from cryptocurrencies, we can go deeper and talk about how each entity can be truly revolutionary. 

How Blockchains Could Change the World
 

There are important reasons why nearly all cryptocurrencies use blockchain technology. But what makes the blockchain so essential? Let’s address some major benefits of blockchain technology, one by one:

  • Security. By using advanced cryptography and decentralization, blockchains make it extremely difficult for hackers to tamper, steal, and gain control of cryptocurrencies.
     
  • Speed. Usually when people talk about blockchains, they are referring to transferring value aka sending coins. There are countless other possible uses, but transferring value at a high speed is arguably the most important cryptocurrency use case right now. For these purposes, blockchains are faster than any other payment option.
     
  • Cheap fees. Efficiency generally equals cost and effort, which is the reason we have high bank fees. Blockchains make it quick and effortless for users to accomplish their goals when compared with other options, thus fees are extremely low in the cryptocurrency world.
     
  • Decentralization. This word comes up a lot because it is extremely important. One of the biggest reasons, if not THE biggest reason, people are so excited about blockchains is that they give us an opportunity to take power away from the oppressive, unpredictable, and untrustworthy authorities and give it back to the people. In Bitcoin’s case the aspiration is to redistribute power from the banks to the people
     

Blockchain is a very powerful technology. The way atomic bombs rely on nuclear fission reactions is analogous to the way cryptocurrencies rely on blockchains. Blockchains change the world by making cryptocurrencies possible.
 

Does Cryptocurrency Have the Power to Change the World?
 

Now that we understand that cryptocurrencies are built on blockchain technology, we can begin to see their properties. Security, speed, efficiency, decentralization, they all sound great. But how does it all come together? How can cryptocurrency actually change the world?
 

Cryptocurrency Will Topple Major Institutions
 

For a number of purposes, cryptocurrency is superior to our current methods of doing things.

Cryptocurrency will beat banks by giving people better ways to handle their finances.

Cryptocurrency will beat major exchanges by offering lower (or non-existent) fees.

Cryptocurrency will beat social media platforms by making the creepy companies behind them unnecessary (a decentralized social media network won’t steal and use your information).

The list goes on and on: vacation rentals, gambling, cloud storage, content distribution, and more. Almost anything that is being accomplished today will be improved with blockchain technology, and that means it’s only a matter of time before a cryptocurrency is developed to topple the major institutions that control today’s markets.

Our future growth relies on competitiveness and innovation, skills and productivity... and these in turn rely on the education of our people. - Julia Gillard

Cryptocurrency Will Make Entirely New Things Possible
 

With their power to connect individuals without middle-men, cryptocurrencies allow people to do business and collaborate in ways never previously thought possible. For instance, smart contracts are one of the most promising innovations introduced by cryptocurrency.

Source: Future Thinkers Youtube Channel
 

Smart contracts are digital agreements that self-execute when their terms are met by all parties or automatically cancel when one or more parties fails to meet their terms. Smart contracts give people a fast, automatic way to do business. One classic use-case is replacing escrow services with smart contracts. The smart contract holds the funds from the buyer, ensures an asset is delivered to the buyer, then releases funds to the seller upon confirmation of both parties.
 

Cryptocurrency Will Dissolve Borders
 

In his landmark 2005 book The World is Flat, Thomas Friedman explained the way technology (especially the Internet) was facilitating interaction between countries that was impossible in the past. Indeed, the Internet removed obstacles between countries and cultures in a huge way. However, cryptocurrency, when fully adopted, will strike the finishing blow to cultural separation.

Due to the decentralized nature, it is impossible and counterintuitive to pinpoint where cryptocurrencies are located. We can say where the companies that develop them exist, but once they are launched, cryptocurrencies are their own entities, distributed amongst their users.

It does not matter if their users are American or Korean or Russian; any person who deems a cryptocurrency useful can use it. This allows the seamless transfer of value between individuals that live anywhere. Accomplishing the same things without cryptocurrency would be near impossible.
 

Get Ready; Cryptocurrency is Changing the World
 

As we’ve seen many times in the past several decades, the individuals that adopt, understand, and utilize new technologies first are the ones that stand to gain the most from it. When email first arrived, some people took advantage of it immediately. Others resisted it for years, but still ended up using it out of modern day necessities. This same pattern is followed with every new technology, and cryptocurrency will not be an exception. You will end up using it, whether it is today or in ten years. You may as well get started today and start learning about how you can be apart of this movement!

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