INTRODUCTION TO CRYPTOCURRENCIES AND BITCOIN RELATIVE TO THE WORLD ECONOMICS – THE UNTOLD STORY (Part 2)
This article is a work of fiction. Names, characters, places, and incidents are either the product of the author’s imagination or are used fictitiously. Any resemblance to actual events or persons, living or dead, is entirely coincidental.
You see the problem? A government backed currency like the kobo with value so low and negligible that even we the citizens do not have trust in it, because we are scared that the other person won’t accept it, and here lies the problem, repeat after me, “Government backing does not guarantee anything!”, repeat this 100 times till you let it sink inside.
And this should tell you a lot about cryptocurrencies, money and a trust system as a whole, I am sure you are beginning to see that our money is backed by… what? Trust! Yes, trust! Thank you very much! Just trust! Trust of whom? Not ourselves, but a few group of people, known as the government, what gives the government power? Is it the military they control? Their TV voice? Wait! Their rules and regulations? Or the money they control and regulate, that same money we all trust them to take care and determine its value for us, trust them to make as much as they want, without us even knowing how much is in circulation, do you know how much is in circulation? Do you?
But! But! But! How can you tell us it’s only food, water, clothing and shelter that has actual value? What about Gold? Silver? They have value! Real value! Well, I wonder how much value that gold or silver will have when you are ravaged by wars, geological hazards like earthquakes, volcanic eruptions, tsunamis, flooding etc. or something as fictitious as an alien invasion, man dug up earth, saw something shiny that was limited in supply and decided to make it have value, trust each other to make gold a store of value, what happens when people stop wearing gold chains?
I mean can you think up something apart from gold chains and wrist watches that you could use gold for? You can’t even use it to buy things easily. To me this is another classic example of the theory of the greater fool! Why do you think real estate value of places to prone to flooding always drops? Don’t even get me started on the story of how the US dollars used to be backed by gold, but isn’t anymore, wait! You mean one of the greatest currencies of all time is backed by a shiny solid substance some first adopters agreed to trust each other to have value? but that’s a story for another day. The next time someone tells you bitcoin or other cryptocurrencies are backed by nothing or are speculative, ask them what their own currency is backed by.
Apart from the food, water, clothes and shelter I mentioned all other things are valued on trust, what happens when that trust crumbles? Crashes, crashes will happen, huge ones, now let’s begin our story, the importance of cryptocurrency.
I am sure the first thing most people will want to see here is making money, sorry guys, that’s where the speculation inherently starts from. I will discuss 2 major importance, and we can talk of the rest in the future, maybe some disadvantages and the dark side of the crypto world.
So stay with me and follow this story carefully…
THE IMPORTANCE OF CRYPTOCURRENCIES AS A WHOLE
Mr J was really tired, so he decided to leave work early, halfway to his house he felt very hungry, he had no cash with him so he turned to the next best thing he had, his MasterCard he decided to drop off at a fast food restaurant nearby, on getting there after waiting near the counter for over 10 minutes due to a very long queue, it was his turn to order food. So he ordered then he was told the amount. As he slotted his card into the POS machine, he was getting an error message – not enough funds, he was wondering how, and why and he remembered he had done an online transfer that morning and reached his daily limit. Mr J felt frustrated to his bones, he nearly screamed, he left the food on the counter snatched his card from the fast food operative and ran away…
- In the crypto world, provided you own your private keys, you are your own bank, and due to it being decentralized, no one can decide how, when, or where to spend your money.
The CEO of paradise Z, Mr Burnley B, was a guttural fighter always thinking up ways to move his company ahead, now his company would be having their first IPO(Initial Public Offering), he had to be ready to do what was necessary, he asked Mr X, “is everything ready?” Mr X replied, “Yes sir! The auditor is here”, “good! Get me those documents”, Mr Burnley B started working towards the conference room, where the auditor Mr A was waiting, “Mr A! oh! what a pleasure!” rumbled Mr Burnley B, Mr A stood up immediately, “the pleasure is mine sir”, “sit down” said Mr Burnley B, who took a sit opposite Mr A, so he could look him in the eye, and intimidate him, it obviously worked as Mr A, immediately appeared uncomfortable, Mr Burnley B smiled to himself, he didn’t get to be the CEO by playing nice.
Then he striked, “Mr A, I want you to look the other way and approve our in house number and auditing” he paused, still looking at Mr A closely, Mr A swallowed, Mr Burnley B continued “of course you will be compensated for your hardwork”, Mr A finally smiled, “ you need not say too much sir, it is already done”, “good, I like men of action”, at this moment Mr X stepped in with pieces of papers, “here they are sir” he said, Mr Burnley B took a close look at them, smiled and laughed a big hearty laugh.
To Be Continued!
Enjoyed this article? Watch out for the third and final part.
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