Cryptocurrencies are the future of money (one man’s opinion)
Locally in Bermuda cryptocurrency has become a lightning rod for discussion from the political sphere, business, reinsurance and even socially.
While I care not about the political side, I do care about what these technologies can do for my home countries of Bermuda and the United States, what job and industry benefits they can bring. We are locally in Bermuda spending a lot of time and energy talking about what companies are good and legitimate vs what ones maybe a “reputational risk” as we like to call it here in Bermuda. While there are legitimate concerns that we should investigate and be wary of, I don’t tend to want to close down car dealerships when someone gets into accident for bad driving.
There are questions on the technology and business implications that these groundbreaking advances in technology may have, not only the island of Bermuda but also internationally. Bermuda stands to be a headquarters for many of these companies building solutions, yes we have things to sort out and verify the companies that are coming here are legitimate. However that’s not any different then any other industry.
The people of Bermuda, who have been focused on training in Tourism & Hospitality, Legal and Account for decades, will see a very positive uptick in business. It’s not different for countries seeing an uptick locally. As these companies come to fruition. If we’re able to attract these companies through smart and minimal legislation & regulation there are huge benefits from the outside jobs, people and businesses that could come to the island.
These advances are not only changing the way day to day economics will function but also have data, currencies and potentially governments function on a micro and macro level.
I do feel the need to weigh in and provide clarity and understanding as many people do not really understand cryptocurrency or blockchain. There is many things to unpack here and it’s important to do so on a national level here and to the world as look to understand these new advances.
1st we need to de-couple all of the verbiage. It would be too long to go into all of the different items in one article, but let’s just be clear that blockchain is the overarching technology that born the fruit of cryptocurrencies, exchanges, new upcoming technologies in privacy and security, Initial Coin Offerings, security offerings… It’s a long list that was jumbled all together in many people’s minds.
I’ll cover just Cryptocurrencies here for now.
Cryptocurrency, why its better…
The notion that a new currency is a Pyramid Scheme (usually mixing in wrongly other terms like “Tulip Bulbs” or “Ponzi Schemes” is about as equal to saying that the Bermudian Dollar (or any current fiat) only exists because other people think it has value. Which is in fact is the case. (Here in Bermuda we have our own currency, but its pegged to the US Dollar).
I’m not an Economist, but I am a student of Business, Economies and of Blockchain. The only “real” use case for the Bermudian Dollar is the fact that at present you can pay for government services for it and other people and vendors think it has value. That’s great, it’s how society here locally and internationally works. You can go buy coffee with the BDA Dollar, pay your (increasing) taxes, buy a house….
It’s a Pyramid onto itself, only because people think it has (a limited) value. You cant go to another country and use the BDA Dollar without going to a bank or another institution to exchange it, which will cost you a significant percentage, does that mean the BDA Dollar doesnt have any value? Well…
Of course not, but you can already see its limitations. Fly into NYC or Toronto and try to pay for lunch with it, good luck!
Traditional fiat currency, the Bermudian and American Dollars, the Euro, the Pound etc are no longer connected to real world assets, so the people’s “faith” in the “Pyramid” is all that is keeping these currencies afloat. We’ve left the gold standard, backing fiat currencies, a long time ago. There is no bank vault of gold, silver or Grandma’s frozen Cassava pie (a staple in Bermuda) somewhere acting as a hedge against a traditional currency anymore.
Cryptocurrency is very similar, in it has value only if other people think it does. Intrinsically you cant make something with it, it’s not gold, it’s a digital piece of information. It’s however backed by great technology. An unchangeable, virtual concrete ledger of transactions to verify ownership, which in part is what validates its worth.
Millions or pennies of USD equivalent crypto can be transferred instantly around the world in seconds. It can be stored in highly secured offline “cold” wallets” locked in a safe or put on exchanges to be traded globally almost as easily as you sending an email.
It is what money should be. Easy(ish), borderless, with minimum fees and as fast as sending a text message or email. These will only improve as more people start understanding the technology.
Unlike cryptocurrencies such as Bitcoin, governments can and do print more and more paper cash as they manipulate their economies, try to manage their increasing debt loads and artificially prop up economies.
We have major companies, financial institutions and entrepreneurs, if that’s important to qualify that this technology is taking off, building solutions and investing into the space. Governments around the world are racing to understand and attract companies to the shores, not just Bermuda.
What we are seeing in cryptocurrencies playing out is I dare say moving past an experiment into a beginning of a large change in how we conduct business and transactions day to day.
Recently a study showed that “500,000 people surveyed in Ontario — approximately 5 percent of the province’s population — are currently holding cryptoassets. More interestingly, though, the study taps into the reasoning behind their acquisition.
46 percent said that they purchased the cryptoassets because of their interest towards their underlying technology. 18 percent even noted blockchain’s potential to prevent fraud and loss.”
There is a ground shift coming world wide. It may take another 10–20 years before it becomes “main stream” (how long did it take for everyone had a credit card or even 100 years ago a car). We are witnessing the beginning of something as substantive as the automotive industry or computing in general. Bermuda could be a major player in that sphere.
References
https://bitcoinist.com/500000-in-ontario-own-cryptoassets-new-study-shows/
https://www.slideshare.net/coingecko/coingecko-2018-q1-cryptocurrency-report
Gilbert A Darrell is the Founder of Horizon. He has 18 years experience in information technology and telecom solutions, a veteran in Fire and EMS Services, a crypto enthusiast and a member of the Bermuda Government’s Cryptocurrency Task Force.
Horizon Communications is an upcoming fixed wireless internet and cellular service provider looking to provide services in Bermuda, the Caribbean, and Central America before expanding internationally.
While utilizing 4th generation and soon 5th generation wireless technology, it will also heavily incorporate blockchain and cryptocurrency technology, one of the 1st ISP’s in the world to do so and the 1st to tokenize their services using an Initial Coin Offering (ICO).
More information can be found on their website — www.HorizonComm.co
