Bitcoin, as a currency or commodity, can be used to settle debt, remit money, or conduct online payments. While some participants will rarely hold on to Bitcoin for long in order to not be exposed to volatility in value, others exclusively use it to store value and speculate on its future uses.
Legally, Bitcoin holds a different status in countries around the world. While some governments regard it as a virtual currency, others have gone so far as banning its citizens from using it. As Bitcoin takes away a state’s power to arbitrarily print money, freeze accounts, and censor transactions, it is often seen as a significant threat to authoritarian regimes.
It might feel like we don’t need Bitcoin, or we may be unsure about what we might need it for. Similar to the early days of the world wide web, Bitcoin seems to mainly attract dubious characters, facilitate drug trading, or conceal other financial crimes. However, Bitcoin has the potential to transform society and build a truly digital economy in which everyone on this planet will be able to participate, free from coercion, censorship and debasement.
Banks, payment processors, and financial services remain inaccessible to the majority of Earth’s population. These people may be able to look into the digital economy that the internet has enabled, but they are unable to take part in it as entrepreneurs, producers and consumers.
With Bitcoin, they are suddenly given a tool to transmit monetary value with the same ease as sending a text message. They can support family members abroad, get paid for work online, and find cheaper alternatives to the products they consume.
Essentially, Bitcoin has the potential to challenge the status quo digital economy. That’s because it’s radically different from other forms of electronic payment:
1. Your transactions cannot be censored
When sending Bitcoin to somebody, nobody is able to block your transaction. You alone decide who to transact with. This also means that nobody is able to take back money that has been sent to you if they change their mind about the…