Erik Weijers, 10 months ago

A reminder why we believe in crypto

It has been clear for a while now: we are in a bear market. Will there be a quick rebound or is this going to take some time? No one knows. That's why it's good to take a step back from the charts. Why do we believe in crypto in the first place?

A group of prominent Bitcoiners, including Nick Carter and Alex Gladstein, are currently in Oslo at the Freedom Forum. There they are talking to the Norwegian government about how Bitcoin supports human rights worldwide. The stories of Bitcoiners from countries like Nigeria and Venezuela remind attendees why it is important to own assets that cannot be confiscated by a government.

Lyn Alden lists a few experiences of speakers from such countries:

  • Ire from Nigeria told the Norwegian parliament how their bank accounts were frozen because they were protesting police brutality and how they used Bitcoin to stay in operation.
  • Mauricio from Venezuela told how he mined Bitcoin so he could flee the regime without losing his money.
  • Farida from Togo explained how difficult it is to send money to family in Togo. Banks often seize it. Smuggling bills was an option but Bitcoin makes it easier.

We don't have it that bad. Or do we?

The people telling the above stories live in countries where there is more corruption and money devaluation. In comparison, we don't have it that bad. Indeed, people in Western societies have it better. But that does not mean that we live in a fair system. The devaluation of our money is going fast these days.

Ever heard of the Cantillion effect? That's the phenomenon of skewed wealth distribution that occurs when new money is created by a central bank - for example during recessions. This money mainly ends up with those closest to this proverbial printing press: banks and large investment funds. The 'ordinary people' suffer most, because inflation leads to a lower purchasing power of their savings. This has hit people in Western countries hard in recent years: the interest rate is 0% and the money press keeps on raging. That is also a form of confiscation of our money, or at least our purchasing power.

So is crypto all hunky-dory?

Crypto is a grassroots movement that has emerged to give people back the ownership of their money. Of course, it is an experimental world where things occasionally go wrong. Some projects fail catastrophically.There are hacks, and there is no guarantee that the price of coins will continue to rise. But the genie is out of the bottle. Since Bitcoin has entered the world stage, every monetary authority feels it: we're onto you. We have an alternative now. If you guys screw up too much, we'll move to another system. In fact, we're already in there, partly.

To what extent do you believe in the benefits of crypto? And to what extent do you believe in the traditional financial system? Most likely, the answer in both cases is not an absolute 100%. After all, no system is perfect. And so it might not be such a good idea to put all your eggs in one baskets. Not all in crypto - but not all in the traditional system either. What percentage do you choose? Everyone has to balance that themselves.

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What is mining?

Mar 15, 2023

Cryptocurrency mining is the process of verifying transactions on a blockchain network and adding them to the public ledger. The process involves solving complex mathematical algorithms using high-powered computers to generate new blocks of transactions. The reward for successfully mining a block is a predetermined amount of cryptocurrency.

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