We all know bitcoin. Well, sort of. What about other cryptocurrencies like ether, litecoin, EOS, or Facebook’s libra?
Central banks, as finweek readers would know, control the supply of money. They regulate the monetary system tightly to ensure stability. It has worked fine thus far. Well, mostly. Save for Weimar Germany, Zimbabwe, Venezuela and others. Commercial banks, of course, facilitate financial transactions within the system. But commercial banks have grown obese and slow-witted on inflated transaction fees, leading to marble-bedecked lobbies and, often, arrogance and complacency – especially in an age of rapid new technology-driven deployment options.
Recently a great rumbling was heard, especially among a few tech nerds. Money is a private affair, they said, we need a new sort of money. We want a financial system in which there are no central banks and prying eyes, and which is infinitely secure, immutable, borderless and answerable to no central authority.
And so, in 2010, bitcoin was born. For the first time there was a small but noisy competitor to the traditional monetary system. Bitcoin was designed, from the ground up, as a token of exchange between strangers. Particularly untrusted strangers. It turned out to work exactly as envisaged.
What is bitcoin?
The bitcoin blockchain allows your wallet to send bitcoin currency to someone else’s wallet. Delivery is guaranteed, can’t be changed, is logged forever (literally), is perfectly accurate, reasonably fast (at a negligible fee) and can be used anywhere in the world. Currently, banks cannot match this on any level.
This story is from the 15 August 2019 edition of Finweek English.
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This story is from the 15 August 2019 edition of Finweek English.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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