Some Technological Innovations to the Structure Behind Cryptocurrencies
The point is that the ideological motivations that have driven many to take an interest in the Bitcoin system, mainly independence from a central authority, involve a small minority of people. Above all, people are interested in a fast, cheap and safe payment system: but for now, using cryptocurrencies is still complicated, poorly protected, and above all unpredictable. In short, traditional payment methods respond better to the needs of most people.
Failures or route accidents
There are other aspects that some have considered of Bitcoin bankruptcies, and which according to others are normal and surmountable path accidents: transaction fees, which were ideally very low, have reached significant percentages in the past months and are still often higher than those applied by banks. The various cyber thefts, the fraudulent nature of some sites where to buy and store cryptocurrencies, which in some cases have closed without paying back the investors, have also raised concerns about the security aspect of cryptocurrencies, one of the strengths of the initial project . “The inherent hostility towards technology regulations has attracted many like-minded people but for the wrong reasons,” wrote the Economist. And there is also the environmental aspect: maintaining the structure of Bitcoin (“extracting”, in technical jargon) requires enormous amounts of energy.
Cryptocurrencies that are no longer
Bitcoin’s expansion coincided with the parallel birth of hundreds of other cryptocurrencies, associated with projects that are often confused if not entirely fraudulent, which were financed in large part with the so-called ICOs, i.e. fundraisers which in many cases were nothing more than scams. The absence of regulation, combined with the wave of great enthusiasm, the widespread hope of getting rich easily and in a short time, and the lack of information and culture on the topic of cryptocurrencies (and in general of economics and information technology) has led many people to lose money. In May, the Wall Street Journal had had it analyzed1,450 ICOs, finding suspicious elements in at least 271 of these, which had raised over a billion dollars in total. According to a study by Coinopsy and DeadCoins, over 1,000 cryptocurrency projects went bankrupt in the first six months of 2018. bitqt is best way to make money.
Some technological innovations to the structure behind cryptocurrencies, such as the so-called Lightning Network, promise improvements that will make the system faster, safer and more efficient. But the initial infatuation that is created when a niche is suddenly frequented by the general public has vanished, more and more skepticism is circulating about the possibility of development of cryptocurrencies.
As interest in the topic developed, however, the warnings and concerns of the major economics and finance newspapers were almost always snubbed and dismissed by cryptocurrency enthusiasts. A certain approximation in the way they were treated contributed to this, as well as some statements on the verge of provoking millionaires, bankers and international financiers. The main channels of information for many investors have been forums and subreddits – the thematic channels of Reddit – in which information circulated by low-skilled people or interested in manipulating the hopes and beliefs of users.
This blessed blockchain
“The future is not cryptocurrencies, but the blockchain” is one of the most popular forecasts that we hear when we talk about these issues. With blockchain, one of the most mysterious words of 2018, we mean a structure shared and accessible by multiple users, who make their IT resources available, such as the calculation speed of their computer or the internet bandwidth, to create and keep updated a database accessible by all participants in the blockchain, and protected by cryptographic keys.
The idea is that a distributed database like that of the blockchain is more agile, inexpensive to maintain and above all secure compared to a large central archive. Santander bank, which invested in the blockchain behind the Ripple cryptocurrency, estimated that the international banking system could save $ 20 billion a year in administration costs by using the blockchain.
The blockchain that interests most private companies, however, is different from that of cryptocurrencies, mainly because it does not provide free access to everyone: banks are not interested in sharing their administrative part with customers.