By, Blythe V. Rymer
Feb 15, 2018
If you have walked into any coffee shop, office, or family gathering, then you’ve probably heard everyone talking about how Bitcoin is “going to the moon” and “crypto is the future.” If you haven’t, then take your earbuds out and listen up. It’s all over the news, the web, and everyone’s tongues. Your coworker is stressing over buying Bitcoin at $19k and is watching the price go down. Your 17-year-old nephew is starting a YouTube channel showing his cryptocurrency trades, and probably makes more money than you do. He can’t shut up about blockchain. You might be sick of it to the point where you’re rolling your eyes, but here’s the thing; cryptocurrencies and blockchain technologies are here, they’re important, they’re being taken very seriously on a global scale, and they will affect your life. So, pay attention to it because this is not a fad.
Not just for nerds anymore
Crypto talk has become mainstream, even if blockchain adoption and altcoins are still in the early adoption phase. You can’t turn on the news or watch a YouTube video without some mention of Bitcoin or the Bitconnect Ponzi scam that took so many people’s money. Ten years ago, when Bitcoin first became a thing, nobody outside of the blockchain developers themselves really knew anything about it. Even four years ago, when I first started looking into it, it was very new and uncertain how it would hold up. Now, I bet you a Bitcoin that you know someone who has invested in cryptocurrencies. This is now mainstream knowledge.
Although cryptocurrencies (and there are WAY more than just Bitcoin and Ethereum) are still in an early adoption phase, more and more places are accepting them as a form of payment. You can pay for purchases online with altcoins, you can transfer money to your friend with them, you can even buy a meal at a restaurant and pay with cryptocurrency. Not only can you pay with crypto, you can also get paid with cryptocurrency. GMO Internet, in Japan, is a publicly traded company that is now offering its employees the option of receiving a portion of their salaries in Bitcoin. Another payroll company out of Canada, Wagepoint, gives businesses the option to also pay their employees in part with cryptocurrency. One by one, more companies are seeing this as a perk for their employees and are signing up. There are many reasons for this, including the low cost of transactions and the ease of converting the coins to other currencies.
Your bank could be investing in cryptocurrencies
For a while, there was fear that financial institutions would try to shut down cryptocurrencies. After all, it is seen as a way to bypass many of the fees and shady tactics of banks. However, instead of shutting down the technology, financial institutions are realizing that they stand to benefit from it. J.P. Morgan, who has seemed indecisive about the future of crypto in the past, has just released their “Bitcoin Bible.” This is a document detailing cryptocurrencies and blockchain technologies for investors and tells them that cryptocurrencies could be very valuable in diversifying clients’ financial portfolios. Although they state that there is a chance Bitcoin’s price could still drop, they also make it very clear that crypto is here to stay in one form or another.
J.P. Morgan isn’t the only big name getting their feet wet in crypto. Western Union just announced a partnership with Ripple, another blockchain technology, and altcoin. This coin has a use case specifically designed to appeal to financial institutions, with super-fast transactions speeds well above the slowness of Bitcoin, and nearly no transaction fees. Even the CME and CBOE now have Bitcoin Futures on their exchanges, so institutions can hedge their Bitcoin trades. This is a sign that Bitcoin is being viewed as a commodity and a store of value, like gold. In fact, Bitcoin has been compared to gold many, many times.
Your government wants in on this
Love may run the universe, but the love of money runs countries. You better believe that if banks are taking cryptocurrency seriously, then governments are too. China has cracked down on trading ICO’s, cryptocurrency mining, and most exchanges, but it is FAR from anti-crypto. In fact, China is one of the first countries to put serious work into creating its own digital currency. Russia is also working on its own altcoin. In the U.S., altcoin trading profits are now being taxed as capital gains, and much research is going into how to regulate ICO’s and exchanges. Hopefully, this will limit the number of “shit coins” and scams that are put out there, like Bitconnect. Even the state of Arizona is trying to pass a bill allowing you to pay your taxes in Bitcoin! If our governments are taking this seriously, then so should you.
Blockchain World Domination! ...maybe, probably.
The technology behind altcoins is called blockchain. It relies on something called Proof of Work and uses changeable public keys and decentralized ledgers that must all agree for a transaction to be verified. This is why it’s so powerful and so difficult to corrupt. Blockchain technology allows for privacy and security like nothing else.
The applications for this go far beyond cryptocurrencies. Blockchain has given rise to new startups that are exploring the practical applications of this technology. Some examples are in distributive data storage, healthcare privacy, and preventing voting fraud. Given the level of corrupt voting practices in this country and others, you can see that blockchain could solve a lot of problems!
Whether you ever own a single altcoin, cryptocurrencies and blockchain technology are a part of your life, and it will become a bigger part of the future. Regardless of whether the price of altcoins is a bubble right now, this technology is here to stay and to evolve. Remember the dot-com bubble? Now try to imagine your life without Google and Amazon. You can’t do it. This is where we are with cryptocurrency and blockchain.
So, stop rolling your eyes at your obnoxious coworker talking about “lambos.” Just kidding, you can roll your eyes at that one. But, maybe listen to your annoying, know-it-all teenage nephew and talk to him about blockchain. He is, after all, making more money than you.
Sources:
France-Presse, A. (2017, Dec. 14) Japanese company to start paying employees in bitcoin. Retrieved from https://www.theguardian.com
Mack, E. (2017, Dec. 15) Corporate Bitcoin Salaries Are Now a Thing (Sort Of). Retrieved from https://www.inc.com
Bradbury, D. (2014, Sept. 7) More Companies Are Paying Employees in Bitcoin. Retrieved from https://www.coindesk.com
Coleman, L. (2018, Feb. 9) Blockchain-Friendly Arizona Moves to Allow Bitcoin Tax Payments. Retrieved from https://www.ccn.com
Terzo, G. (2018, Feb. 12) JPMorgan: Cryptocurrency is Unlikely to Disappear [Yes, Really]. Retrieved from https://www.ccn.com
Parts, H. (2018, Feb. 15) Western Union Confirms Testing Ripple Technology For Money Transfers. Retrieved from https://cointelegraph.com
Abbruzzese, J. (2018, Jan. 8) What happens when governments get into cryptocurrency. Retrieved from https://mashable.com
Bloomberg (2018, Jan. 17) This Is How China Is Stifling Bitcoin and Cryptocurrencies. Retrieved from http://fortune.com
Lorinc, J. (2017, Sept. 19) Beyond Cryptocurrency: There are new blockchain opportunities for SMBs. Retrieved from http://business.financialpost.com