Jan-Lukas Else 09 Dec 2020 19:37

One keeps hearing about some cryptocurrency projects and how people got rich with Bitcoin. But somehow I don’t understand the whole purpose behind it and I’m beginning to suspect that it’s just a pyramid scheme.Wouldn’t there be much better ways to exchange money anonymously and uncensored? In order …

Well, I’m going to try to quickly explain the best I can. First of all, blockchain and cryptocurrencies are not interchangeable. Secondly, “crypto” was historically used to refer to cryptography and not cryptocurrencies. I don’t agree with whoever started this trend.

But somehow I don’t understand the whole purpose behind it and I’m beginning to suspect that it’s just a pyramid scheme.

Even though I don’t agree with the way Bitcoin works and believe Ethereum is a much better alternative (more on this below), this documentary is fantastic to explain the problems we have nowadays and how Bitcoin (or any other cryptocurrency) can help solving it. Right now, both Bitcoin and Ethereum are based on Proof of Work (PoW). PoW is the mechanism that allows the network to come to a consensus and this mechanism uses a lot of electricity. However, Ethereum is moving to Proof of Stake (PoS), which uses much less energy. Here’s a nice article that quickly explains the differences.

Wouldn’t there be much better ways to exchange money anonymously and uncensored?

How? I’m pretty sure everyone is open to suggestions.

In order to generate any kind of coins, a lot of electricity is used (also from fossil fuels or atomic energy),

True, for now. But that was a choice of Bitcoin, and Ethereum. Ethereum is changing. There’s more cryptocurrencies, obviously, but I’m not aware of how they all work.

until today no project based on cryptocurrencies or the blockchain principle has really caught on

I think the main difficulty is making it easier for the end consumer, and also making the end consumer care. I know countless of people that are aware that many companies have way too much of their data. But do they care? How to make people care? How to make this technologies easy for people to use without all the technical terms, like public and private keys, addresses, etc?

I actually have some notes on blockchain that are not very explained, but there’s so many applications. For example, smart contracts is probably one of my favorites, since they’re trustless contracts. The transaction will happen, no matter what. You don’t need to trust the other party.

Well, I have to go eat breakfast 😅Hope I managed to explain something!

Or if you don't know what a response is, you can always write a webmention comment (you don't need to know what that is).

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Tomáš Jakl Tomáš Jakl liked this post. — 12 Dec 2020 09:05
Jan-Lukas Else Jan-Lukas Else said: One keeps hearing about some cryptocurrency projects and how people got rich with Bitcoin. But somehow I don’t understand the whole purpose behind it and I’m beginning to suspect that it’s just a pyramid scheme.Wouldn’t there be much better ways to exchange money anonymously and uncensored? In order …09 Dec 2020 19:37