Why bitcoin erratic price is not important
Bitcoin prices have dropped nearly 60% since January this year, the rate of decline has been more than the Russian ruble. Some critics say, this is evidence of the failure of digital currency.
Ignore these, whether the price and the underlying technology bitcoin will disrupt the key problem of the financial system is not relevant, but there are many indications that the answer is yes.
Bitcoin is not only a kind of currency. From Silicon Valley to Wall Street investors to they think a lot of money and expertise into such an adaptive technology platform. Software developers can use bitcoin anywhere in the open source code to create specialized applications, which allow enterprises to direct commercial exchanges in nomiddlemen conditions. These applications may produce many from banks, Forex firm, escrow agent, clearing, notary, lawyer or service.
Of course, these are not that bitcoin will succeed. And those detractors will behoove that most families do not buy or store such a large fluctuations in the value of money. In fact, bitcoin transactions still continue to rise. Although more and more businesses begin to accept bitcoin, including Microsoft, Expedia (EXPE stock market rose 0.31% (DISH) and Dish Network’s stock market rose 0.30%), digital currency is still not worth mentioning in the share of global trade.
Although some small businesses do not meet the bitcoin, but it is not important. An important question is whether a large number of software innovation about encryption currency will bring solutions to allow enterprises and governments to protect themselves from such and such price fluctuation risk can benefit. In Silicon Valley many people’s point of view, bitcoin, or some of its other clones will be operating in the context of global economic. But those small businesses don’t even know it’s there.
Balaji Srinivasan, a partner in the Vc firm, the Anderson Horowitz foundation, the company is located in California, Monroe park. He put bitcoin’s current conditions compared to Linux in early. The open source operating system Linux was initially trying to compete with Microsoft’s Windows on the personal computer, but eventually became the main enterprise server operating system. Like some bitcoin believers to hold legal tender point, early Linux supporters have overconfidence said, “we will beat Microsoft.” However, despite almost never in the personal computer desktop, but Linux on the server successfully. Mr. Srinivasan said, “over the past 15 years, we now know the Internet is cannot do without Linux.”
Mr. Srinivasan talked about the Linux and Windows “dual boot” is popular because technical personnel can also use their best features. He also said that this encryption and currency developers to make their applications with the traditional monetary system “interaction”, is similar. Bitcoin, a more efficient exchange system more directly and cheaper, will be able to support through the Internet and offline payments and transfers, and economic seamless connection. In the offline economy in the dollar and other currencies will continue with the dominant position of the traditional.
According to the news website Coindesk, co founded by Netscape pioneer — Mark Anderson’s Mr. Srinivasan’s company, is one of dozens of start-up companies bitcoin a total investment of $311 million this year. From $93 million in 2013 has been up to now. Celebrity names sound like Internet history behind these transactions recorded: from Silicon Valley legend Draper Draper from the Tim family, led the British Reid Hoffman YAHOO (Yahoo, the stock market fell 0.06%) founder Yang Zhiyuan and many others.
Let these people feel excited is the infrastructure bitcoin “scattered”: people, by consensus blockchain famous distributed ledger – by an independent computer network real-time updating and maintenance to get the accuracy of the data.
The computer is called the miners. They earned in exchange for new bitcoin blockchain maintenance ledger can be likened to newly mined gold miners, but the real work is to verify information. This important role for individuals and businesses that there is no other way of mutual trust can be traded without intermediary expensive third party intervention. This is the “decentralized trust” is better than that of spokewise “concentration” the international financial structure in the first case, “focus on the international financial structure is created by the Medici Florence in the renaissance.
Fast and low cost information verification system not only realizes zero bitcoin procedures for credit card companies, banks, payment processors or exchange fee payment, also dispersed in many other economic functions. Because any information can be embedded into the blockchain ledger and its core software is an open platform, the new company is building a large number of “bitcoin 2” application, and it is based on some of the same principles: the blockchain based car sharing service, personal ID system, database management and asset management company is not registered, even by one operation by software program operation of the crazy idea.
Wall Street is now in action. Senior investment manager of the bank also joined the bitcoin startups. The hedge fund also in the transaction of electronic money. The price fluctuation of Ex-trade staff is building a high-tech platform and derivatives to better management of digital currency.
The price of bitcoin is now Bloomberg quoted. Some banks are using encryption currency network to achieve the international transfer of corrugated laboratory. Some of the Federal Reserve Bank area is also considering how to achieve the Fed’s interbank payment system pipeline.
At the same time, the United Kingdom, Mexico and other countries, the government is studying the blockchain solutions to improve economic transparency.
Excessive government regulation may also stifle encryption currency, but the smart regulation can also make it legal. 上周，纽约财务服务的监管人——本杰明·劳斯基公布了修订后的“BitLicense”的细节,这种促进创新的做法受到很多在比特币社区的人的欢迎。
It is important to develop, but not bitcoin price volatility.