If someone is a member on Steemit, then I think that it is fair to assume that you know what Cryptocurrency is? I mean how else would you know what it is worth to have good content posted on here? So I will not bore anyone with all the details about Bitcoin, Ethereum, etc.
So we all know what a cryptocurrency is, but why is understanding them and their usage a good idea? To explains this I will go into economics. I was recently sitting in a conference discussing cryptocurrency and I overheard the lady sitting next to me saying that she did not understand how the exchange process worked. How do you get paid for your bitcoins if you want to cash them out?
I explained it this way. You have to think about it like the commodity exchange. Everything is worth something, you just need to know how much of any particular commodity your asset is worth. That is why we have the dollar. A U.S. Dollar has no inherent value. It functions as a rate of exchange and is only worth what you can buy with it.
Take gold for instance. Right now 1 ounce of gold is worth a little over thirteen hundred dollars. Say you don't want your ounce of gold anymore you exchange it for dollars. Okay now you put in Bitcoin. You don't want your dollars anymore you go on to a website like Coinbase or Kraken. You put in that you have $XX.XX and it shows you how much that is worth in Bitcoins.
She seemed to understand the concept with that example that I provided, and that got me to thinking about the exchanges. The cryprocurrency is like the stock market, commodity trading, or currency exchange rates. Now I live in the Midwest of the U.S. so I will stick with the dollar enology. One U.S. Dollars is not worth the same amount as a GBP. One Great Brition Pound is for about $1.29 as of 08-31-2017. Meaning that the Dollar relative to the Pound as 29% less buying power.
There are many different factors that go into why a currency goes up and down, and this is where I feel that the price of stocks is relative. The price of a stock can go up and down, and the price of all the shares is part of the value of the company. If the CEO of a major corporation is tangled up in a sex scandal that could cause the value of the stock to go down, and the company as a whole. What I am talking about here is perception, and that brings me to commodities
I have always been a fan of the film Trading Places with Dan Aykroyd and Eddie Murphy. In my opinion the best part of the film is when the main characters are in the exchange and waiting for the frozen orange juice futures. All the prices of each commodity were going either up or down relative to the demand for that commodity. Well, this is it, the last bastion of pure capitalism left on Earth."
This film having been released in the 1980's this is no longer true. Coming full circle, with the down of Cryptocurrency I do not think that this is true any longer. With the dawn of currencies such as Bitcoin capitalism is moving into a new age with a rate of exchange that is and will be much like gold was in ancient times.
It has been said that there are several reasons why gold was the rate of exchange used by nations like Egypt in the BC era. One of these is because it is a softer metal and easier to form and cast. Another is that it is relatively harder to find in relation to other metals. But the reason that was most prevalent throughout all the articles was simply the fact that it is gold. Gold is valuable because it is gold.
One trading site that I use is called Listia. I will speak more about this in another article, but the Listia credit has some similarities to Steem. You get some credits for signing up, credits can be purchased, and others can use their credits to purchase its that are listed on the site.
The only reason that I understand cryptocurrency is because I understand all of these other concepts relating to commodities and economics. That is why I believe that cryptocurrency is where money is headed in the future. I also think that with so many it will be like the currencies of today with the Dollar, the Pound, and the Yen. The money of tomorrow will be the Bitcoin, Ethereum, and Bitshare.
I have personally discussed this with Michael Taggart, and when he described Bitshare and the history of Bitcoin I think that his currency has possibilities. As it stands Bitcoin can do 7 transactions per second. When describing his technology, Taggart told us about a currency that could do 180,000 transactions per second.
Now I don't know about you, but if this is going to be anything like Bitcoin now is the time to buy!
When technology advances rapidly it takes some time to get things right. Bitcoin was a fair start, but Bitshare is the 2.0 version. I believe that cryptocurrency is the future, and I want to get on this buss before it leaves the station. Bitcoin started out for mere cents per coin. What will a share that has over 25,000 time the power be worth?
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