{"id":10342,"date":"2021-09-13T08:31:55","date_gmt":"2021-09-13T06:31:55","guid":{"rendered":"http:\/\/eneasmagazine.com\/en\/?p=10342"},"modified":"2021-09-14T10:31:52","modified_gmt":"2021-09-14T08:31:52","slug":"why-should-you-start-paying-attention-to-blockchain-and-cryptocurrencies","status":"publish","type":"post","link":"https:\/\/eneasmagazine.com\/en\/uncategorized\/why-should-you-start-paying-attention-to-blockchain-and-cryptocurrencies\/","title":{"rendered":"Why should you start paying attention to blockchain and cryptocurrencies"},"content":{"rendered":"\t\t
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Today, everyone acknowledges that internet started a technological revolution that lead\u00a0to the information age. Communications developed to such an extent that they\u00a0transformed the world in a way that no science fiction movie could have anticipated. Blockchain and cryptocurrencies are about to start another revolution of similar dimensions.<\/span><\/em><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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In the crypto world, we are at the beginning of a revolution in the means of exchange. Historically, after barter, centralized structures have always controlled currencies, whether it was in gold, silver or paper. Governments, central banks, financial elites, have and still control, currencies through centralized and monopolistic mechanisms. These structures provide the power to confiscate, seize and limit the use of currency. In many cases, such control not only has limited people\u2019s freedom, but it has also deteriorated the value of their properties by issuing new currency and debt, originating higher inflation, deficit and tax strain over the population. Monetary policy malpractice has impoverished many citizens, leaving them economically vulnerable to higher control and dependence from states and rulers.<\/span><\/p>

\u00a0<\/span><\/p>

\"\"People who have suffered greatly from monetary policy malpractice are taking great interest in new decentralized means of exchange\u00a0that can protect their property from abusive confiscation, hyperinflation and any other restriction over their financial freedom.<\/span><\/strong><\/p><\/blockquote>

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But before we continue to try to visualize what the future of the liberalization of the means of exchange lets go over the general characteristics of a cryptocurrency:<\/span><\/p>

A cryptocurrency operates under a blockchain platform that allows the verification of transactions through a decentralized accounting block system that verifies, through mining1<\/span>, the authenticity of the operation. Blockchain technology allows no centralized regulation, no middlemen in the transaction process, delivering a low cost system with confidentiality and transferable property through personal passwords. The technology also allows the free movement of property worldwide. This new technology has raised many critics do to its ease for money laundering and illegal transactions.\u00a0<\/span><\/strong><\/p><\/blockquote>

Volatility in cryptocurrency markets has also risen many critics. To understand the high volatility of this market we have to understand the uses of a cryptocurrency and their variety.\u00a0<\/span><\/p>

A cryptocurrency is similar to owning shares of a startup company with the particularity, among others, that these \u201cstartup shares\u201d can be traded in a market2<\/span> directly with other cryptos without a FIAT currency involved in the transaction.<\/span><\/strong><\/p><\/blockquote>

Let\u00b4s take Cardano and Etherium crypotcurrencies as an example. Cardano and Etherium are both companies that create and maintain blockchain ecosystems to allow other companies to benefit from the blockchain technology. Very similar to what Android and iOs do in the internet mobile world of today. We can trade directly Cardano and Etherium at the market rate without FIAT currencies involved, peer to peer, without middle men, at a much lower cost than at the stock market, instantaneously, from any where in the world, with absolute privacy, without limitations by regulators or third parties.<\/span><\/p>

“Bitcoin, on the other hand, is a particular cryptocurrency. It aims to become a store of value, an alternative to gold and an alternative means of exchange. Bitcoin, similarly to gold, is a finite4<\/strong><\/span> resource that claims to be better than gold for it can be divided to 0,00000001 BTC (allowing micro payments), it can be easily transported and sent instantaneously any where in the world. Bitcoin can also be used to obtain yield in the financial cryptomarkets along with other blockchain uses still to be determined.”\u00a0<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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There are Stablecoins such as Thether (USDT) that attempt to offer price stability by been pegged to a FIAT currency like the U.S. dollar or to a commodity’s price such as gold.<\/span><\/em><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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1 Miners are individuals or corporations around the world with strong computers used to verify blockchain transactions. The fastest miners are payed a fee by issuing new cryptocurrency (that is the case of bitcoin) or by a small percentage of the cryptocurrency transferred or a different one.<\/span><\/p>

2 Cryptocurrency can be bought and sold from peer to peer or in broker and depositary markets such as Coinbase and Binance.<\/span><\/p>

3 Bitcoin is mined, mining could be expressed as creating new currency, similar to a capital increase. New bitcoins are produced to pay miners after transactions have been verified. When no more Bitcoins can be created, miners will get payed by fees from transactions.\u00a0<\/span><\/p>

4 Bitcoin is a cryptocurrency with a limitation on 21M of Bitcoins. There are 18M Bitcoins in the market today. It is estimated that\u00a0 by the year 2.144 Bitcoin mining<\/span>3<\/strong><\/span> would have reached its limit.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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Digging more into the volatility of the crypto market, we also have to consider the nature of the difficulty of startup valuation in such initial phases. Most blockchain projects raise money through ICOs (Initial Coin Offering) in the crypto market even though they are still not sustainable and are in experimental phases. Minor news, rumours or milestones can change market valuations greatly. Volatility is also coming from speculative investors. The crypto market is a non-regulated decentralized market with no limits regarding value fluctuations. Additionally, cryptocurrency technology enables transactions as small as 0.00000001 of a cryptocurrency allowing micro transactions and payments. That is to say, anybody in the world can transfer or invest 15\u20ac from their mobile phone to obtain a portion of a cryptocurrency and have access to a startup liquid market or they can send micro remittance in seconds with practically no costs to their family<\/b>.\u00a0 This example implies the beginning of the liberalization of the means of exchange and the democratization of investments. Having access to a cyptomarket without barriers of entry, with no middle men, no regulators, no minimum tickets, has also attracted small speculators from all around the world contributing to higher volatility.<\/span><\/p>

Crypto volatility and deregulation market looks a lot like the Far West, with plenty of opportunities but a lot of uncertainty and risks. There are still security issues that need to be addressed. The Cryptoworld also reminds us of the dot.com bubble of the 90s. It is very possible that given the actual excess of capital in the markets, the accessibility and ease to invest and the volatility in crypto valuations, has already created a speculative bubble over valuating many projects much like it happened during the dot.com bubble.\u00a0 We must consider that most blockchain projects and cryptocurrencies have still not demonstrated their sustainability.<\/span><\/p>

So how many blockchain projects will be sustainable? Which ones will be the Googles and the Amazons?<\/b><\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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Nevertheless, there is no question that the blockchain technology is here to stay.\u00a0A decentralized ecosystem, with absolute traceability, confidentiality, with instantaneous transactions from peer to peer without middle men, at a\u00a0very competitive cost. Blockchain and criptocurrencies have initiated\u00a0a revolution in the means of change and the democratization of investment<\/b>. It will be interesting to see the years to come, how blockchain\u00a0and cryptocurrencies will disrupt the world.<\/span><\/p><\/blockquote>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

Today, everyone acknowledges that internet started a technological revolution that lead\u00a0to the information age. Communications developed to such an extent that they\u00a0transformed the world in a way that no science fiction movie could have anticipated. Blockchain and cryptocurrencies are about to start another revolution of similar dimensions. In the crypto world, we are at the […]<\/p>\n","protected":false},"author":4,"featured_media":10129,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1,472],"tags":[],"_links":{"self":[{"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/posts\/10342"}],"collection":[{"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/comments?post=10342"}],"version-history":[{"count":13,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/posts\/10342\/revisions"}],"predecessor-version":[{"id":10439,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/posts\/10342\/revisions\/10439"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/media\/10129"}],"wp:attachment":[{"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/media?parent=10342"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/categories?post=10342"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/tags?post=10342"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}