I’ve been reading The Internet of Money by Andreas Antonopoulos recently.
In the most recent chapter: Bitcoin Design Principles he makes some interesting points about how Metaphors for Bitcoin (such as 'wallets') are probably mislead people about what Bitcoin is!
You can buy the book here, it’s based on his lectures from a few years ago now!
In the latest chapter Antonopoulos makes one of the most compelling pro-crypto comparisons with fiat yet!
Money as a Content Type
Bitcoin transforms the concept of money by making it completely independent of the underlying transport medium and turning it into a stand-alone content type.
A bitcoin transaction is a signed data structure that can be executed anywhere in the world. A bitcoin transaction does not have to be transmitted on the bitcoin network, it only has to reach the miners and be included in a block.
All the Bitcoin network does Is forwards transactions and blocks. A transaction can be transmitted over any form of communication medium.
A bitcoin transaction doesn’t incorporate security mechanisms itself. The security is in the proof of work provided by the miners, and the digital signature on the transaction is put there by end users with keys that they store. There’s nothing sensitive or secret in the bitcoin transaction.
Credit Cards: Insecure by Design
If you use a credit card you will fall into one of two categories: you have been hacked, or you will be hacked.
When you buy something with a credit card online you have to give away your name, address, card number, expiry date and 3 digit CVC code on the reverse of the card: basically all the data someone else needs to use your card to make a purchase for themselves.
When I make a purchase with a VISA card I essentially hand over my keys with it, and rely on encryption along the chain of sale to keep my data safe as it is passed from agent to agent. If encryption fails at any point, my data is vulnerable.
Even worse, some companies store my credit card data, making this a target for hackers, something which has happened a lot in the past.
It is impossible to secure this kind of (lack of security) system from motivated hackers, we simply do not know how to do it!
This is a very insecure system.
Bitcoin Transactions: secure by design…
In contrast, Bitcoin transactions contain no sensitive data: all a message broadcast on the BTC network contains is a reference to an existing (unspent) amount of money related to one address and a reference to where the money is being sent: delimiting who can spend that BTC. The private keys are not broadcast as part of the transaction message: anyone can see it and they can do nothing with the information.
Governments cannot stop BTC transactions
This is because the information required to send BTC is separate from the BTC itself, and it is only the information that has to be broadcasted to BTC miners for the BTC to be sent from one address to another.
You can theoretically encode the 256 bytes of information required to send BTC in any communication medium: Facebook, Skype, Wikipedia and so the only way to stop BTC being transacted is to shut down the internet itself.
It’s even possible via shortwave radio.
Separating the Medium from the Message
When the medium of communication is expensive the messages that get produced are controlled by wealthy elite gatekeepers: this happened with the printing press and the bible - those who control the medium conflate the messages they want to produce as having value and assume everything else is relatively worthless, and thus not worthy of being communicated.
Today with social media the cost of communicating is worthless and so we have billions of messages sent via social media everyday, many of them glib and just for fun, but we would be mistaken to assume that just because there is no longer a cost to producing messages that they do not have value.
The tweeting during the Arab Spring proved this - and it would be a mistake on the part of the elite news media who control the more expensive to produce TV news that their version of reporting has more value just because it is more expensive to produce.
Cheapening the message means more vulgarity, sure, but there is value in there too. Crypto means the meaning of money is now free from the medium
In the fiat world global finance networks determine that small transactions aren’t worth sending internationally because the fees make sending them pointless.
However with crypto, we are able to send $0.10 transactions on the same network as $1M dollar transactions ({obviously dependent on the crypto). It makes doing things like tipping on microblogging sites for just a few cents possible.
The grand arch of technology
Only grandparents use cheque books, only grandparents watch Fox News, only Grandparent financial institutions cling to the idea of FIAT banking systems.
Thoughts
This is a nice reminder of just how insecure the fiat money system is, and a reminder that it only makes sense for those in power.
Now we have crypto, decentralised security is simply much more secure than centralised fiat ‘security’, and it’s cheaper to use.
This seems like a very rational argument for crypto and against FIAT!
A few months ago today I also had a similar incident, I had money in my bank. I get a call from a number and he tells me that I am talking to the bank and he also told me some details which were my personal due to which I gave him the code but later when I When it was done, it was found that he had given the call package and he had done online shopping for all the money and till today the money could not be returned. Risk is everywhere, so it is better for people to keep their money in crypto and manage their key's well. In this way, we have seen that there are banks from america who have said that we do not have money to give, so people have run out of money there too.
My alarm bell wld have gone off as soon as I got that call - I'd always sign off and then investigate independently
Love it! I like when people realize how fake is "traditional finance" and how everything that is presented as "safe and secure" is completely the opposite! And all that is happening because of this...
That's why it's crucial to support and use Web3 apps and nurture HIVE!
btw... maybe I'm too old, but I still have problems when I have to buy something online and give ALL MY DETAILS to the vendor... not just all my credit card detail, but all my personal details too...
I have picked this post on behalf of the @OurPick project which will be highlighted in the next post!
I'm the same - in that dirty fiat world - spread it about helps reduce risk!
Some people write off blockchains as inefficient databases, but they fix various issues. With banks you have to trust them to get it right and for everyone involved to maintain good security. With millions of points of failure it's bound to go wrong, so they have forms of insurance to pay for mistakes. With crypto you take some responsibility as a user in keeping your keys secure. That does mean we need good user education, but then people should be aware of the risks in any system they use.
Nicely summarised - I am generally in favour of more personal responsibility but it does make me think about how the genuinly vulnerable wld cope in a fully decentralied system!
We've seen today how trust can fail with the hack of Leofinance Discord. When there's free money on offer people may drop their defences and not realise it
Wow I wasn't aware it was hacked!
Not good!
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Although government can't stop bitcoin transactions but it will crack down the exchanges so we won't be able to convert it in the fiat currencies. Will that not cause people to stop buying bitcoin?
That could certainly make it more challenging for sure! There are always peer to peer ways of getting it out!
P2P transactions are also being reported to government by the exchanges.