Here’s all you need to know to act like you get bitcoin

As a political science major, the learning curve while interning at a bitcoin start-up has been steep to say the least. The world of bitcoin is a world of obfuscation. Many articles try to talk about the technicalities of bitcoin, or the wonders of the digital cash or the dangers of using it for terrorist funding, money laundering et al. Yet, as a social science kid, I learn that historical context is everything. Learning about what bitcoin was meant to be and what it has come to, will be critical in understanding what future it holds.

So, here’s a timeline that shows the evolution of what bitcoin was meant to be and more importantly, what it can be used for now and in the future.

Bitcoin was meant to be digital money

Many have tried, and failed, to create a digital version of the monetary system until bitcoin emerged. Traditionally, money had to a) be minted at a bank to prevent counterfeiting, b) be portable and divisible so that it would be easy to use in large or small transactions and c) not allow a double-spend (i.e. you cannot spend that same note twice). The bitcoin system could do all that. Hence, bitcoin only needs the trust from the masses to gain real purchasing power before it could take over government-controlled money. (e.g. USD, Yen, Yuan, Euro etc.)

Its intended use case: Money.

Yet, it was too volatile

While a bitcoin is currently valued at approx. US $400, which means that people trust it enough to have real purchasing power, it has proven to be a lousy currency for everyday transactions. People cannot mark their prices in bitcoin because it is so volatile. However, its volatility and high price make it a pretty good investment opportunity for risk-takers. Hence, people started to trade bitcoin.

Its intended use case: Digital “gold”, for speculative trading

Additionally, we found it a viable medium of transfer.

Blockchain all day, everyday

Final thoughts