Bitcoin and Blockchain could change the course of history
One of the biggest steps forward for the human race was moving away from a bartering system towards trading in cold hard cash.
One of the biggest advantages of using a monetary system was that money is tangible and doesn’t lose its value as easily as livestock or vegetables and fruits could under the barter system. The other advantage of a monetary system is that value (coins) can be attributed to the state (good or bad) to stock. Society is once again on the precipice of another advancement. The grow in popularity of cryptocurrencies such as Bitcoin shows how eager the human race is to once again break the bonds of their historical chains and trade in a completely new way.
There are a lot of critics that bemoan cryptocurrencies labelling its growth as a face and a bubble that is waiting to burst. There biggest qualms is that cryptocurrencies are not tangible and do not have an intrinsic value.
However, there are some advantages that cryptocurrencies can offer companies.
The growth of Bitcoin has been nothing short of staggering; and there are no signs of this growth abating in the future. In fact, according to a recent article on the CNBC website, Bitcoins growth is only just starting.
The articles author, Evelyn Cheng, pointed out that Nomura analysts Yoshiyuki Suimon and Kazuki Miyamoto estimate the wealth effect of bitcoin could boost consumer spending in Japan to as much as ¥96 billion ($855.4 million).
The concentration of bitcoin’s price surge in the fourth quarter of 2017 could result in a potential boost to real GDP growth in the first quarter of up to about 0.3 percentage point on an annualized quarter-on-quarter basis, the analysts said.
The article added that Nomura analysts did point out that Bank of Japan Governor Haruhiko Kuroda said in late December that the bitcoin price surge was the result of speculation. If the growth of Bitcoin can significantly benefit the Japanese market, imagine what it could do for the growth of emerging markets.
The underlaying system that is driving Bitcoins growth is Blockchain. While this also has its critics, it is a system that could provide the foundation of a future system that could change the face of investing and monetary trading.
According to an article on coindesk.com, we haven’t fully realised the growth potential of Bitcoin or Blockchain.
A research analyst at the Royal Bank of Canada (RBC) sees cryptocurrency, blockchain technology and decentralization as a potential $10 trillion ecosystem. The article added that in a new report released Wednesday, Mitch Steves, an equities analyst with RBC’s Capital Markets subsidiary, laid out his bull case for why the future of transactional services will ultimately be decentralized. “While the cryptocurrency space has many risks, the opportunity appears vast with constant technology updates,” he wrote.
Though startups that enable cryptocurrency protocols to serve as decentralized alternatives to proprietary services or as a means of transmitting remittances have garnered the most interest throughout the ecosystem’s formative years, Steves argues that the protocol layer (on which these services will be built) is where most of the value will be realized.
According to an article on nasdaq.com, there are some challenges that Bloackchain needs to overcome.
The article points out that the majority of the public is still oblivious to the existence and potential uses of this technology. In order for blockchain technology to make the move to the mainstream, there must first be a public buy-in to its benefits. Though the technology is revolutionizing many different industries, knowledge of the benefits of distributed ledger technology is still limited to those who are involved in the technology space and those whose industries are adopting blockchain solutions.
The article adds that presently, blockchain technology is nearly synonymous with Bitcoin. Though the value of bitcoin continues to rise to unprecedented levels, there is still an association of the cryptocurrency with the shadowy dealings of money laundering, black market trade and other illegal activities.
Before mainstream adoption can be achieved, members of the public must understand the difference between bitcoin, other cryptocurrencies and the blockchain. This will help remove the sometimes-negative undertones of Bitcoin and allow the technology to stand on its own, which will lead to an increase in willingness to utilize the technology.
Privacy and Security
The article points out that Blockchains, as in the original design, are made to be publicly visible. Take, for instance, the Bitcoin blockchain, which is designed to be accessible to all those who have made a transaction on the network.
In the case of bitcoin and other cryptocurrencies, this is an important feature. However, for governments and corporations, this creates a number of concerns. Governments and corporations have a need to be able to protect and restrict access to their data for a myriad of reasons. This means that blockchain technology cannot work in spaces with sensitive data until this challenge is met.
However, the article adds that a blockchain can be customized to meet the needs and specifications of the task at hand. A blockchain can be made permissible. This means that people are only able to access parts of the blockchain that are relevant to their tasks. Although creating such blockchains takes a sizable amount of planning and expertise, it lessens the apprehension that firms and governments have about the technology, thus making adoption more likely.