The Bitcoin Revolution Read online



  The Bitcoin Revolution

  by Steven Hager

  EPUB ISBN 9781311484284

  copyright 2014 by Steven Hager

  Introduction

  When I tell people to buy bitcoin, the most common reaction is what for? I tell them not to think of it as currency, but as stock in a new bank designed to compete against the Federal Reserve money monopoly. Cash is like a landline, credit cards a cell phone, and bitcoin is the smart phone of the bunch. Investing in Bitcoin is like investing in personal computing or the internet before the digitial age took hold.

  The savvy investors are now working on Bitcoin 2.0 which will aid Bitcoin contracts, stocks and derivatives. There’s so many advantages to Bitcoin over fiat currency, but most important, you can program it. It’s the first smart money and it will do to money what smart phones did to dumb phones. If you don’t “get” Bitcoin, maybe that analogy will help you, because it’s spot on.

  Dumb money is like a nice Chevy. Smart money is like having your own private roads that go anywhere the Internet goes. Oh, and your car is faster than anything else in the world. And there are no tolls and no speed limits on any of your roads. Does that sound like something you might be interested in?

  You can forget about investing in the stock market soon. Pretty soon, the intelligent companies will be funding with smart money and won’t be putting layers of middle-men, brokers, banks and lawyers in charge. Bitcoin represents the release of immense pressure from trying to cram too much too fast through a tiny funnel at the top of the food chain.

  It is a great time to be alive. This is a magical story unfolding before our eyes, and the possible slaying of some dark wizards by a Jedi Knight who calls himself Satoshi.

  Birth of Bitcoin

  Bitcoin is a computer software published at the secretive Cryptography Mailing List in 2008. Welcome to the wonderful world of spooks. Cryptography, in case you didn’t know, is the art of confidential communication. Aaron Burr was one of its modern masters, and likely a British agent most of his life. But since no one could decipher his cryptography during his lifetime, he was acquitted when tried for treason. Had his codes been cracked, he likely would have been hanged.

  The timing of the release of Bitcoin does not seem accidental, for in 2008 the world was wracked by a global currency collapse, precipitated by the American banking industry, which had been profiteering off a real estate refinancing bubble. But when real estate crashed, some major banks began collapsing and a global financial domino effect initiated. The Federal Reserve and many other central banks responded by creating trillions in debt with a computer keystroke, distributing the magic funds secretly around the financial system to keep the banks propped in place.

  Bitcoin was published under the name “Satoshi Nakamoto,” but it remains a mystery who that is, or whether Satoshi remains alive. For several years he was easily found online, in various forums, discussing his invention through a disposable IP address in Panama. But then in 2010, Satoshi gradually disappeared behind the curtain, leaving a young Princeton graduate named Gavin Andresen in charge of developing the software, which is still in beta after years of shakedown. There’s also a board of consultants comprised mostly of early advocates of the software who claim their foundation is tetering on insolvancy and faced with a major crisis due to the explosive growth of the network. The current software is not capable of handling a massive rise in use, something that is expected to occur within the decade. Increase in value is expected to occur as more people adopt the system.

 

  Satoshi made a few comments that reveal a possible leftwing political agenda, but mostly he has steered away from politics and Bitcoin remains neutral in this regard. Satoshi rejected any connection with Anonymous or the Occupy Movement, even though the software carries the potential to transform society for the better. Instead, he concentrated on creating a digital currency that would turn inflationary fiat into smart money: gold on steroids. Previous attempts to forge digital gold had been attempted and failed, and Satoshi had obviously studied them all. Because he sometimes used words like “bloody,” my suspicion always was Satoshi was British by education, if not birth. Why would he go into hiding? Well, he is shooting for becoming the world’s first trillionaire, something that would greatly shake-up the world’s power structure, and since the last person who tried to create digital gold is wearing an ankle bracelet in Florida right now, perhaps he didn’t want to stick around to see if any major governments were going to outlaw bitcoin and place him under arrest. So far, that’s only happened in Thailand, and all indications are there are major alliances taking place between Bitcoin and Wall Street and the rise of the crypto currency may already be too high to stop.

  In the first few years, bitcoins were deemed worthless, and, in fact, the first transaction was 10,000 bitcoins for two pizzas in Silicon Valley, coins that are worth around $20 million today.