BITCOIN

Lambos

My Journey

• Intro Dec '12
• Enlightenment '16
• All in since then

Disclaimer

• Opinions
• Careful of experts
• Not financial advice
• DYOR
• Invest wisely

What is Bitcoin?

Confirmation Bias and Bitcoin

... has drawn from a variety of schools of thought: game theory, cryptography, hacker culture, the open source movement and libertarian ideology.. 

Bitcoin

• Volatile - Foreign Currency
• Media Frenzy 
• Interesting in Short Term
• Great for:
  • Lambo's
  • Memes
  • Obituaries
  • Bubble analogies

• Same irrespective of price
• Interesting Long Term
• Great for:
  • Disrupting old structures of power
  • Creating global economies
  • Decentralising trust

 "In order to understand bitcoin, you need to understand money and, in order to understand money, you need to understand the history of money"

 - Wences Casares

Yap People & Rai Stones

Money by Design

Bitcoin by Design

• Scarce:  Limited 21 million supply 
• Divisible: 1BTC = 100 000 000 Satoshi
• Frictionless: Multi-medium transportability with almost real time settlement
• Verifiable: Cryptographically secured
• Durable: Global, Decentralised and Open Source

History of Money

• Credit backed Barter: stones, shells, cacao beans
• Commodity money: Barley, Tea, Pelts
  • ~5000 years ago rare metals
  • ~2700 years ago first minted coinage
• Redeemable Money: Commodity backed paper money 
  • 17-19th Gold Standard
  • Bretton Woods System
• Fiat Money:
  • 1971 Nixon Shocks
  • ~40 years: Cheques and Digital Credit

"Fiat money is a currency without intrinsic value established as money, often by government regulation. It has an assigned value only because the government uses its power to enforce the value of a fiat currency or because the exchanging parties agree to its value"

Next Generation of Money

• Cryptocurrencies:

  • October 2008: "Bitcoin: A Peer-to-Peer Electronic Cash System" - Whitepaper

  • Jan 2009: First version of bitcoin goes live

Why is Bitcoin Revolutionary?

The internet gave us a decentralised global network that allowed the sharing information

Bitcoin gives us a decentralised global network that allows censorship resistant transfer of value

Bitcoin brings into question the existing power structures.

"Just as the Enlightenment brought about the separation of State and Religion,

So does this technology provide of the possibility separation between state and money"

• Power of choice
• Checks and Balances
• Economic Self Empowerment

Why separate Money from State?

• Banking the unbanked
• Remittance
• Hedge against inflation/hyperinflation
• Protect Wealth
• Global Economies

Bitcoin Use Cases

So...Why do we need it?

• Current System:
  • Banks own your money on deposit
  • Banks spend your money
  • Subject to closed, centralised monetary policy
• Bitcoin:
  • You own your money
  • P2P network with no intermediaries allows you to spend your money without fear of censorship
  • Subject to predetermined, mathematical monetary policy written into code, open to all

Join the revolution

Twitter: @a21n_

Bitcoin Resources: lopp.net/bitcoin.html

Sources

• John Lanchester on bitcoin and the nature of money
• History of Money
• Hyperinflation in Germany

• What is Bitcoin? - Wences Casares

• What is bitcoin? The best money in human history

Deeper Dive

Proof of Work

• PoW Waste = Security of Network
   
• Synonymous to current systems:
  • ​Vaults, Security Guards, Electric Fencing
  • Datacenters, Disaster Recovery Centers
  • Counterfeit Preventions
  • ...entire Banking infrastructure

Ecological Impact

• Move towards stable green energy
• Huge investments in sustainable computing
• Energy usage not linear to adoption/transactions
  • Auto adjusting difficulty
  • First a year ran on < 5 computers
• Innovations and protocol changes (PoS, DPoS)

Challenges

• Scaling
• Adoption
• (de)centralisation
• Regulation
• End user security
• User experience

The Future

• Lightning (Instant, Low Fee Payments)
• Rootstock (Smart Contract)
• Tumblebit (Anonymous Payments)