The old adage “money makes the world go round” holds true today, and likely will continue to do so until the end of time. But with the rise of Bitcoin, the currency of the future may be web-based, non-physical, and decentralized, quite different from what we know today.
Money is the only thing we have in common – regardless of nationality, gender, religion and origin. It improves our lives, society and the world. We all work hard to earn and save money to buy the things we need (like food, shelter) and to help us fulfill our hopes and dreams.
For many of us, cash or currency is the physical notes and coins issued by the government, which we in turn use or hold in banks. Over the past decade, however, Bitcoin (a form of digital/virtual currency or cryptocurrency) has progressed, gained momentum, and captured the attention of many financial and technical communities.
Bitcoin was created in 2009 by an unknown person or group of people (using the pseudonym Satoshi Nakamoto). This is his gift to the world; a means of freeing people from the economic shackles of the modern banking and financial system. It is a new type of currency that is completely independent and not controlled by any government, central bank or financial institution. No one owns Bitcoin, but it belongs to everyone who uses it. Its development is a direct response to the systemic corruption within the world’s current financial system and its ongoing manipulation of our hard-earned money.
Throughout history, money has controlled economies and gained political power. When governments around the world switched from hard money to fiat money in the mid-20th century, there was a major shift in money. Hard money is when the value of a currency is tied to a tangible commodity such as gold or silver. Fiat money, on the other hand, is when governments create money, declare its value without requiring us to trust their word to guarantee or back it.
Today, central banks around the world are creating money “out of thin air” (called “magic money”). This money is funded by debt, interest payments, etc., which is the system most financial institutions drive, even if inflation devalues the currency. It allows them to take more of our money when we don’t know what’s going on.
With Bitcoin, it is hoped that individuals will have greater control over their money and benefit from lower interest rates and fees. It has no physical representation and all personal balances and debts are listed on a decentralized and open ledger that is universally accessible for complete transparency. In today’s internet-driven world, Bitcoin has the potential to empower an estimated 3-4 billion people in the third world by eliminating the 10-30% service fee that companies like Western Union charge when they need to send or receive money .
Although it’s only been a decade since Bitcoin’s decline, its future could swing left and right. Will the world continue with the current financial structure? Or will Bitcoin disrupt and change the traditional financial world? Only time will tell.
Directed by: Torsten Hoffmann, Michael Watchulonis
