Cryptocurrencies. Seemingly ubiquitous yet deeply mysterious all at the same time. This wave of digital money has taken the world by storm, with another brand of crypto coming out of the woodwork seemingly every other week. But what exactly are they, and what do they mean for the future of currencies, the internet and humankind in general? Should we be worried about them, or embrace them with open arms? Let’s get to it. It’s Crash Course time.
What is Cryptocurrency?
If you don’t already understand it, you may feel like it’s too late to ask. You’ve no doubt heard proponents touting it as the future of money, but what does that even mean? BeingLatetotheParty.Sucks, but we’re here to help get you up to speed.
Cryptocurrencies are a form of digital currency that exists entirely without physical form. They work as a medium of exchange and use cryptography to secure and verify transactions as well as to control the creation of additional units. Cryptocurrencies are decentralized, meaning they are not controlled by any bank, government or centralized financial authorities in the same way that fiat currencies like dollars, euros and yen are. Instead, the Internet is responsible for guaranteeing the currency’s value and publically recording every transaction to ensure the same digital coin is not spent twice by the same person.
How are these records kept, you ask? This process relies on things called blockchains, or public digital ledgers on which all crypto transactions are recorded. Data is stored across a network, ensuring that the information is not susceptible to hackers or central failure. Still with us?
Today there are technically over a thousand cryptocurrencies out there, but they are not all created equal. In fact, a select handful holds the market share of the industry. Two of the most famous cryptos include Bitcoin and Etherium (no, that isn’t an 80s hair rock band). However, there are many other cryptos out there doing big things, meaning the market is in constant flux.
Now, with every boom comes a bust, and as the dust settles following the explosion of cryptocurrency, the world is slowly becoming aware of the potential dark side to this revolution. To paraphrase Ms. Swift, scammers gonna scam, and the dawn of crypto is being met with fierce supporters on either side of the fence.
The Dark Side of the New Internet
While there is a lot of genuine excitement and energy going into the development and trade of cryptocurrencies, there are also some people taking advantage of this early boom. In 2016, for example, more than $50 million in Etherium was stolen by hackers. And in perhaps the biggest crypto scam to date, Bitcoin investment lending platform BitConnect abruptly shut down its lending and exchange services after it was revealed that the platform was essentially a Ponzi scheme. We’re still waiting for the Martin Scorsese movie.
The potential dangers of the crypto market have led big league players like Facebook and Google to ban all cryptocurrency and ICO advertising. According to Facebook, this move is intended to improve the integrity and security of the platform’s respective ads to protect users from companies advertising binary options, ICOs and cryptocurrencies who are not operating in good faith. In other words, they are trying to make it harder for scammers to take advantage of their users. The announcement caused Bitcoin to fall by about 6%, with other major currencies like Ethereum and Litecoin also taking a hit.
Like anything, it always feels a bit risky to get in on things before they take off. At the same time, being on the ground floor of something huge can have an immense payoff. Take the Winklevoss twins as an example: they invested $11 million dollars in 2013, to see a return of more than $1 billion dollars in 2017.
Like cryptocurrencies, .SUCKS domains are on the verge of shifting how we think about the internet, and the world in general. We don’t all have to be under the armoured hand of fiat currencies and .coms. We can forage forward, with knowledge and information as our backers. After all, no one ever stood out by trying to blend in.
Photo Credits: Shutterstock / PHOTOCREO Michal Bednarek, Shutterstock / qualitystocksuk