Page 11 - BEST MAGAZINE FALL 2018

That’s what sets Bitcoin apart from traditional payment systems and inefficiency is the trade-off.
• Blockchains aren’t inherently anonymous: everyone can see the transaction (on bitcoin) although nobody knows it was Joe and me involved in the transaction.
• Blockchains are very hard to scale: In exchange for security, trust, fewer middlemen and avoidance
of governments and boundaries, society pays in computational costs, storage (the same blockchain stored on millions of computers is a waste) and slower transaction speeds.
Altcoins:
The cryptocurrency space needs more than just bitcoin to solve its problems. Anything that’s not bitcoin is often referred to as an “altcoin.”
Examples:
1. Filecoin: creates peer-to-peer storage. What does this mean? Let’s say you store data on Dropbox or Google Drive. That’s not Peer to Peer. Your data sits on servers owned by Google or Dropbox. There
is a potential for human error and privacy loss.
2. cash: might be used for transactions requiring high anonymity.
3. Filecoin: might be used for transactions that have a specific storage application.
4. Ethereum: contracts without lawyers or smart contracts. “A smart contract is a set of promises, specified in digital form, including protocols within which the parties perform on these promises.”
Summary:
Cryptocurrencies are here to stay. Up to 99%
of the cryptocurrencies that exist today are total scams.
You don’t need to understand the deepest underpinnings of cryptocurrencies to understand why they are important, why the trend is happening and why there is a $150 trillion demand but only $200 billion in supply.
THE BEST MAGAZINE FALL 2018 11
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