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We Need To Talk About Bitcoin!

Simplified, Bitcoin is three things. A currency. A code. A network.

It’s also a conceptual experiment, a digitised idea, relating to decentralisation, and what happens when you try to create and structure in a decentralised way. It has a mysterious pseudo named originator, and a manifesto white paper, and early disciples committed to spreading the good news.

It’s both fascinating, almost infinitely complex, and evolving, giving rise to a whole generation of new information structures, the blockchains.

The bitcoin and blockchain experiment is ongoing, and over time, perhaps a clearer picture will become apparent.

For now it seems likely the currency of Bitcoin is the least scalable of the trinity, there can only be 21Million Bitcoin ever created, although aspects of network are not very scalable either, the nodes that hold the complete blockchain, and the mining process which both validates transactions and also brings new coins into existence. A few years ago, you could ‘mine’ Bitcoin with a laptop. Now you need a server farm. Bitcoins are designed to ‘run out’ and get harder to mine. It’s based in part on principals of mining for gold. It may also include a principle of mortality. You die, but your code, your DNA, lives on and on and on.

Conceptually, it’s so clever. It’s like a riddle, designed to lead the puzzlers through to a place they could never have found on their own. There’s something esoteric about it.

Stepping back from that, the Bitcoin and blockchain sectors look a bit like the ‘birth’ of the internet. Lots of different networks being created, all similar, all different, all groundbreaking in their own way. Now getting VC backing, as the horses line up for the race, each with a different idea of the course they are on. The fabric is being created, these networks, these modified children of the Bitcoin code, some designed to be public, some designed to be private, some somewhere in between, perhaps these are the true value of the Bitcoin experiment. Not the currency of Bitcoin, but the codes, the DNA which can be copied and engineered and made into new and improved versions. The digitised concepts of the network.

It’s like a riddle, designed to lead the puzzlers through to a place they could never have found on their own. There’s something esoteric about it.

Over the next few years these blockchains, and there are hundreds already, may start to connect, and the fabric will form a… tapestry of sorts. A blockchain intranet perhaps? The possibilities are similar to the possibilities of the Internet, in terms of variation and breadth of application.

There are commercial opportunities, for sure. Companies that are creating the infrastructure, that are creating the means to connect the networks together using the features of blockchain networks to provide services that weren’t previously available.

There are also problems in the pipeline, for sure. Scalability. Ethical problems. Contraction of the decentralised model back into a more centralised one, which is already happening with Bitcoin, and the problem of trying to communicate something that is essentially a mathematical construct in words. One thing is for certain though. It’s part of our times, and in some way, shape and form, it will sculpt them.

[author title=”Bird Lovegod” image=”http://thefintechtimes.com/wp-content/uploads/2015/12/JS-9721.jpg”][/author]


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