A Beginner’s Guide to Bitcoin and Why it Matters
Render unto Caesar the things that are Caesar’s, and unto the people the things that are the people’s.
“Trust is at the core of any system of money. For it to work, people must feel confident that a currency will be held in the right esteem by others.”
For any currency — traditional or digital — to be viable and widely used by a community or society, the users must trust an authority to honour the value and the transactions in the currency.
To understand what Bitcoin is and why it is important, we have to first understand how intermediaries play a crucial role in providing trust for the money system as we know it.
ELI5: Our transactional system today
Suppose I want to gift a gold coin to my friend Liam, so I meet him to pass him the gift. With my physical presence as I hand him the coin, Liam is able to verify that:
- The transaction is taking place.
- I cannot duplicate the gold coin before his eyes; therefore, I am unable to give the same coin to another person.
The outcome is simple: the gold coin that had belonged to me now belongs to him. Since I no longer possess the gold coin, I cannot give…
