#2 The Cryptocurrency Revolution
Written by Ellis Hudson and Cait Snell.
For many of you, talk of cryptocurrency is becoming increasingly prevalent in your everyday lives. Whispers, across the world, are spreading about what cryptocurrency is, and how it will change the world.
Recently, this commentary has even extended to interviews involving big banking executives, stating bitcoin in particular is a ‘fraud’, while making wildly misinformed statements without any evidence to back them up. A sensible person might ask the question, who are they to comment on cryptocurrencies anyway?
With cryptocurrency fluctuation and volatility is also a ‘normal’, as much as anything can be, part of life. The average life for a fiat currency is around 25–30 years, for example, and many countries have experienced hyper-inflation in that time. If the most recent financial crisis taught us anything, it is that banks themselves aren’t the most stable of institutions.
So what is new then about cryptocurrency?
Cryptocurrency came into being with the birth of Bitcoin, in 2009. The basis is that there is no central repository of ‘coins’ anywhere — they are decentralised using blockchain technology.
Because of its decentralisation, blockchain is built to be inherently resistant to alterations made without others’ knowledge. Therefore, if a change is made at one single point, all users would be able to see. To translate this into real-terms, if you were to try and falsify or modify any unit of cryptocurrency, all other users would be able to view this.
ICOs are a new form of innovation in this field, in which blockchain-based projects can avoid traditional venture capital and raise funds through selling their tokens. ICOs work similarly to a company becoming publicly owned and selling shares, but instead of receiving shares, investors receive cryptocurrency or platform tokens that will hopefully increase in value with a business’ success.
People have been calling Bitcoin and cryptocurrency a bubble for as long as cryptocurrencies have existed. Ironically the scaling of the currency due to the network effect should lead to its increased adoption.
Sweden is one example of a leading edge in cashless society, with 900 of 1,600 banks no longer storing cash or accepting cash deposits. Bitcoin is their latest proposal, and something we’re sure many will be interested to see the results of.
Arkadia is an international peer-to-peer lending company, based on blockchain. Arkadia’s pre-ICO will begin in late November. Check out our other social channels on our profile.