By now I would hope the majority of society has at least heard the term “Bitcoin”. Most about what I knew when I was first introduced to this cryptocurrency was that it sounded like Chucky Cheese or Dave & Buster’s tokens. I definitely know how those work, and for me, they don’t last long.

In a way, I had a part of that concept right; I exchanged my quarters for coins. The biggest problem bitcoin has is it’s ability to explain itself without getting overly technical. A great beginner’s guide to understanding bitcoin can be found in a very organized book titled “What’s The Big Deal About Bitcoin?” by Steve Patterson. I would implore you to read it if you have any questions. In the meantime, I want to give you a few cliff notes to get you started. After knowing this, you won’t believe how I really feel.

Bitcoin is ambiguous in that it is more than just a currency. It is an open source network in which applications can be made. As bitcoin is in its early adoption phase, the infrastructure can be diagnosed as 3 main parts:

A Currency you can exchange for any other currency An Online Ledger - that stores ownership and transactional data of bitcoins everywhere A Software - a program to which you can assign a tangible object to

How this is so different from a dollar, couldn’t be more obvious…at least not anymore.

The Currency:

What makes this piece of currency so valuable is it’s scarcity. There are 21 Million Bitcoins capable of being mined (currently 25 bitcoins every 10 minutes (This number is halved every four years)). With bitcoin being mined at it’s maximum speed over time, there is only so many that can be produced. The graph looks like this:

It has the founding principles of the gold standard, like our dollar WAS not so long ago. For those that aren’t aware, the US dollar has not been associated with any tangible item in existence since FDR. Because the government regulates the Federal Reserve, they can print money whenever and however they want. A basic understanding of economics can show that when supply is high, demand is low. Therefore, your dollars are losing value…right now. Prices go up, you make less money than the cost of living requires, minimum wage goes up, prices go up you make less money… You get the picture. If our humanity requires us to buy and sell, how long can the cycle keep spinning?

(Most importantly) The Online Ledger: “The Block Chain”

Owning bitcoin is like owning a piece of land that you claim. More specifically, you own a piece of the public bitcoin ledger called, The Blockchain. Every fraction of a bitcoin can be precisely identified to the owner. Just like the dollar has its identifying numbers, fractions of bitcoins are just as identifiable though the code of its programing. You have a digital wallet that is password protected on your smartphone or computer. Every transaction between buyer and seller is held in the programming of the public bitcoin ledger. We can get more technical, but I will leave that for deeper thoughts in the comments below.

For anyone in possession of bitcoin, it requires a level of responsibility to protect their bitcoin wallet just as they would a wallet filled with dollars. The only difference is, if someone gets a hold of your cellphone, they have to know your password and other security settings to obtain your bitcoins. The common criminal would have little use exchanging your phone for dollars compared to your digital wallet’s worth in bitcoin. Moreover, it is possible to trace the exact amount of bitcoin to the exact wallet it belongs to. There is a lot more to speak on the security of Bitcoin mainly because you have to be uncommonly smart and determined to own 51% of the worlds computing power (a few billion dollars) to do any actual harm to the bitcoin system. The real security threat is in 3rd party bitcoin sites. There is always a level of risk anytime you entrust someone with your money. Buying and/or selling is risky in and of itself. This matter of security is the same as buying a crappy service in which you have little chance of receiving a refund.

The Software: (The overly technical, but really really cool part)

The most unique property of bitcoin is it’s ability to program itself to the tangible item of purchase. For example, you bought a car. The only key that could ever get the car started is the one purchased by the fraction of a bitcoin that you spent on it. The programming of bitcoin is stored and referenced in cloud storage all over the world. If any amount smaller than 50% of the bitcoin data is destroyed, there is a backup of the data elsewhere that is consistently communicating with remaining storage to retrieve the information. You can’t really say that about the dollar you hold in your hand.

How I really feel

I’m mad that it had to come to this, but I’m overwhelemed with pride and happiness of the potential of this system. The gold standard cannot be achieved through our current government monetary policy. It is a fact that our dollar is going to continue to inflate. Its worth will become less than nothing if we print money based on fairy dust. I don’t know that I will live to see the day of the gold standard if my generation can’t turn things around. What I do know, is the kind of ending we will see for our kids if the war profiteers keep getting richer and the poorer can’t take work hard enough to stay afloat. I understand the need to feel tangible objects in your hand. I still have to pay rent in dollars. But once you are payed in bitcoin, everyone is accepting bitcoin. Nobody will be able to get their hands on a bitcoin unless it is willfully given or earned. That said, it is possible for our government to concentrate all of it’s forces on destroying bitcoin; wasting billions of your tax dollars in the process. What kind of world would we live in if this is actually taking place?

The lack of knowledge in its security, the technological learning curve, and the tradition of earning dollars is holding back the adoption of bitcoin. That said, there is a vast growing community that participate and exchange bitcoin. Today, businesses receive bitcoin. It is free to do so with significantly less intermediary fees incurred. A business can pay its employees in bitcoin. There is already a foundation for this currency to build off of. I see a solution to a problem that couldn’t have been created under any other circumstances. Here is a video that are clear and concise:

I have to say, I can no longer bask in the glory of ignorance when it comes to money. As I get older (13 months short of 30), I find an increasing value in the work that I do to keep a steady income flow. In your profession, you are a construction worker that is trained on a crane and a bulldozer. You are a programmer that is fluent in C++ and Java. You cut hair and style. You teach Spanish and French languages. You work for a living and you have to keep staying relevant and competitive. It is a struggle to find the value of your work. The proof of knowing your worth is defined when you are paid a definitive worth for your labour.

There is a great conversation between Tom Woods and Steve Patterson, the author of, What’s The Big Deal About Bitcoin? It is structured and detailed perfectly for beginners.

If you want to master the concept of bitcoin, follow Andreas Antonopoulos. When you get the time, here is a longer video of his lecture. I will warn you that the camera man was a little lazy. There is a Q&A in the second half. Andreas has all of the answers.