For newcomers, the concept of crypto can be confusing, borderline scary. There are so many things to understand and get to grips with. If you feel this way, you’re in the right place. Today, we’re going to explain blockchain technology and how it’s changing the crypto market, using examples to illustrate our points along the way. With that in mind, let’s crack into our subject.
The crypto market is a competitive space, and it feels as though there’s a new flavour of the month every time we flip a calendar page. However, some coins retain their value and stick around, with the BTC Bull Token touted as the next big thing. It can be difficult to discern which coin is actually worth investing in and which is simply being touted by those flipping a profit, like the hustlers you find spamming their followers on Twitter. The best way to avoid getting scammed is to do independent research.
Now, onto blockchain technology. Imagine a digital ledger shared among computers. Every transaction is recorded and verified by multiple parties, making it theoretically one of the safest ways in which we can use our money. That’s blockchain technology. This form of finance is immensely popular in the world of crypto because it doesn’t involve middlemen such as banks. This decentralised finance makes transactions more secure and transparent, while also eliminating unnecessary fees.
But wait, we hear you say, aren’t financial institutions helpful to broker deals? Fair point, and you’re right, but they’re not always entirely necessary. An alternative to a traditional brokering arranging is the smart contracts that are automatically executed when conditions have been met on both sides. Blockchain technology also ushered in the age of the digital asset, although that is at present less heralded than it’s other uses. Who knows, perhaps NFTs will eventually be viewed as valuable and cool.
What NFTs did, at the very least, was to make the art world question what was worth paying for, and that potentially gave artists another way to generate an income. Yet, there’s another controversy to address associated with blockchain, and that’s energy consumption. Early blockchain networks, like Bitcoin’s, have received criticism for using more electricity than small countries. Since this backlash, the crypto community has tried to find more sustainable methods for mining and other blockchain-related activities.
Newer blockchain technologies are adopting more eco-friendly consensus mechanisms. It’s like switching from a gas-guzzling monster truck to a sleek electric vehicle. We’re talking about a reduction in energy use that would make Captain Planet proud. Or at least make him nod in acknowledgement. There’s still a long way to go in truth. You can love crypto and be honest about the problem at the same time. Without honestly facing the problem, there’s no way we can solve it.
If you’re thinking of the primary aim of the blockchain revolution, you might think it’s to get rich. And while we’re sure that it’s a primary driver in activity and participation, it’s not the only big reason that people get hyped about this cause. No, a lot of those who preach the benefits of blockchain technology want to stick it to the banks. They want to democratise finance and give power back to the people. And there’s a strong argument to be made that it’s a worthwhile cause to champion, especially when you see how it compares to traditional banking in many countries around the world.
Imagine being able to send money across borders faster than a speeding bullet and cheaper than a cup of coffee. Or being able to get a loan without having to convince a banker that your start-up selling artisanal pickles is the next big thing. That’s the kind of financial freedom blockchain is bringing to the table. Money is freedom after all, and freedom should be our right.
And let’s not forget about transparency. In a world where “fake news” is as common as cat videos, blockchain offers a way to verify information that’s harder to tamper with than a kid-proof pill bottle. Whether it’s tracking the origins of your organic, fair-trade, hand-picked coffee beans or ensuring your vote in an election is counted correctly, blockchain’s got your back.
That basically summarises why you keep hearing so much about blockchain technology. It’s flipping the crypto market on its head because users see an opportunity to change the way the world works, and it’s a change they’re pushing for. Whether a full digital revolution will take place or not remains to be seen. However, what feels certain is that the world of finance is changing. For that reason, we suggest keeping a close eye on the blockchain space, regardless of whether you consider yourself a crypto bro. One day soon, we could all be paying for our coffees with money sourced from the blockchain.
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