If you read our previous newsletter (here), you know that your boy has found consensus with a girl. And a day before, we were on our second “Decentralized date.” We picked up where we left off our conversation last time. And man! I cannot get this conversation out of my head….
Her: So tell me, why is blockchain such a revolution? And how can Bitcoin become a global currency?
Me: Great questions! The 2008 financial crisis really shaped Satoshi Nakamoto's vision for Bitcoin. He saw the fraud and corruption in the existing financial system and wanted to create a decentralized alternative.
In his whitepaper, Satoshi talked about how blockchain allows for a "peer-to-peer version of electronic cash" that doesn't require trusting financial institutions as intermediaries. It cuts out the middlemen and democratizes finance.
Her: Hmm, but how does it work exactly?
Me: Picture traditional finance as a kingdom ruled by powerful barons - the banks, government regulators, and big corporations. They control the money supply and transactions based on trust in their authority.
Blockchain is like a rebellion that transfers power to the people! Everyone collectively verifies transactions on a transparent, tamper-proof ledger. No single entity controls it, just like democracy.
During the 2008 crisis, the financial barons (Lehman Brothers majorly) acted recklessly and caused widespread suffering. But they escaped accountability while ordinary people paid the price.
Satoshi was fed up with this injustice. He wanted a system that prevents manipulation by dispersing control across a peer-to-peer network. Like overthrowing corrupt kings to establish representative rule.
So he proposed a system where everything was - decentralized, transparent, for and by the people. Instead of one entity holding the purse strings, decisions and transactions occur via consensus across a peer-to-peer network.
No shady back-room deals. No cooking the books. No mismanaging funds. The blockchain ledger is immutable and visible to all.
Satoshi’s Bitcoin takes the idea of Blockchain one step further by creating digital money with fixed supply. Scarcity prevents arbitrary printing that debases currency value. Personal savings cannot be eroded by inflation under the whims of central bankers.
And Bitcoin has the potential to evolve into a global currency that transcends borders and monopolies. Imagine a world where everyone has open access to transparent and honest money. Financial freedom bringing more power and opportunity to the masses.
Her: Wow, that's quite an analogy! So it's really different than normal currencies?
Me: Completely! Fiat money is issued by central banks, which can print excess cash, causing inflation that erodes savings.
With blockchain, the supply is transparently managed by decentralized consensus. Bitcoin has a fixed supply that can't be debased by arbitrary printing. It gives control back to the people!
Plus, bitcoin transactions are permissionless, borderless, and pseudonymous. It enables financial freedom beyond government controls. Like peasants circumventing the king's decrees!
As blockchain scales, legacy finance will migrate to this model. Banks must transform to remain relevant, becoming decentralized networks instead of walled gardens. Public accountability will be the norm.
Her: Haha okay, I think I'm starting to understand why it's so revolutionary. This has been quite an enlightening date so far!
We have already booked our next date on the coming Friday, we both are eagerly looking forward to it, hopefully you too ;)
Stay tuned for more updates on our decentralized dating journey!