Bitcoin: The Internet of Money

 

          Bitcoin & CryptoCurrency will have the biggest influence on socioeconomic infrastructure since the introduction of the internet. The blockchain network, through which Bitcoin operates, takes the power of banking away from financial institutions and gives it back to the people. Services that traditional banks provide require people to manage and oversee. Bitcoin can provide these same services, but as a technology eliminates the need for human intervention.   

Example: Transferring money from Bank of America to Westpac, for any amount of money, incurs a fee on both sides amounting to $45USD. Transferring any amount of bitcoin only involves a 50cent transaction fee. 

          There can only ever exist 21 million Bitcoin, therefore if you own 21 that guarantees that you are one of a million people with at least that quantity. In a world of seven billion people that is a pretty good ratio. The people who think it's too late to buy Bitcoin are unable to see the big picture. The market capitalisation (total amount of money invested in an asset) of Gold is 7.3 Trillion dollars. If bitcoin reaches just 5% of Gold's market capitalisation, every Bitcoin will be worth $24,500 (http://worldbitcoinnetwork.com/BitcoinPriceModel-Alpha.html). 

         Price is predictable because of the predetermined linear supply curve Bitcoin has. By 2030, 99% of all bitcoin that will ever exist will have been mined. Currently, 78% of bitcoin's supply has been mined. Right now the reward for mining a block is 12BTC, in 2020 this reward will drop to 6BTC, in 2024 3 BTC, in 2028 1.5 BTC, in 2032 .75BTC etc. This process is known as the halving rate, and takes place every four years as mining blocks become exponentially more difficult (www.bitcoinblockhalf.com).  

          The demand for Bitcoin and CryptoCurrency, in general, is growing at an unprecedented rate. On January 1st 2017, CryptoCurrency's combined market capitalisation was only 18.24 billion. As of September 1st 2017, it has become 177 billion (www.coinmarketcap.com). This is because society has begun to realise the how CryptoCurrency is a more efficient way to store value and conduct transactions with smaller fees than you would incur through traditional banking methods. 

 

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