Is there any value in digital currency?
As a representative of digital currency, Bitcoin is actually a peer-to-peer payment system. For example, if you want to make a transfer, you need to complete it through an intermediary, such as a bank. Everyone’s books are stored on the bank’s server. This has some advantages and will be more efficient, but there are also some disadvantages, such as its own integrity issues, security issues, inflation issues, and so on.
The state prints the money, how it was spent, to whom it was spent, and what purpose it will be used for in the future. We have no idea about this, but there is no way. We can only use the money printed by the state. This is a problem of centralization. , Countries all over the world have this problem.
Bitcoin has created a decentralized system, and everyone who participates in Bitcoin has a Bitcoin ledger. If you want to initiate a transaction, everyone will come to keep your account. Of course, there is a process of absenteeism and mining. Everyone competes for this accounting right. If you compete, the Bitcoin network will give you the transfer fee and give you some rewards to encourage you to mine and mine. Then you have to broadcast the ledger to all people on your node, and then everyone will help you do this bookkeeping together.
In summary, digital currency actually has several characteristics:
First, full-node accounting is decentralized, so that data is difficult to tamper with.
Second, all data is open and transparent.
Third, data can be traced, because the entire ledger is open and transparent.
Speaking of this, do you think that, for example, our food traceability can solve this problem.
What changes can digital currency bring?
What can digital currency change? The first is to reduce the cost of credit; the second is that it can break the hegemony of data; the third is the issue of traceability.
Of course there are some problems:
The first problem is that mining consumes electricity. There are two solutions to this. One is to solve it through other consensus algorithms; the second solution is joint mining, where you can mine other coins while mining Bitcoin.
The second problem is decentralization, security and efficiency. You can only get two of these three.
If you want decentralization and security, there is no way to show efficiency. If you want decentralization and efficiency, there is no way to be safe. It may fork, but if it is safe and efficient, there is no way to decentralize. Therefore, in different application scenarios, how to use these three conditions together may require some effort.
The third issue is the distribution of benefits among developers, miners and communities.
There is a particularly large miner called Bitmain, who has 30 to 50% of Bitcoin's computing power. It believes that Bitcoin should go in another direction. The developers of Bitcoin, they developed Bitcoin, but did not benefit from it, so they became spiritual aristocrats and regarded money as dung.
But they look down on these people like Bitmain who make money by mining. So there was a disagreement between the two groups, and the whole community was standing in line. Standing on the side of developers, or on the side of miners, there is a big problem in the distribution of benefits of this community.
In the end, Bitmain said that it would make another bitcoin, called bitcoin cash, and one coin became two coins. If this is infinitely divided, the scarcity of bitcoin will also be challenged. So actually this is a big problem. This problem can actually be solved. Through a two-layer consensus algorithm, there is a foundation at the same time, or the holder of the coin will vote to decide whether the block dug out by the miner will be recognized and whether to reward him.
We are in an era of digital currency revolution driven by blockchain. Although encrypted digital currency still faces many challenges and there are too many unpredictability in the future, technology is the primary productive force, and the development and growth of blockchain technology is destined Change the direction of the tide.
In the future, private digital currency may coexist with legal digital currency, becoming a new stage of human currency development, and it will also reconstruct the monetary system and financial institution system, and reshape the international financial ecology.