Bitcoin Made Simple

News & Current Events Public News & Current Events
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Whether you understand it or not, Bitcoin and other ‘distributed ledger’ technologies are spreading at an accelerating rate across the world.

<img class=“aligncenter size-medium” src=“https://peakprosperity.com/wp-content/uploads/2021/09/Bitcoin-Familiarity-Chart-1024x816-1.png” alt=““Bitcoin awareness poll” width=“512” height=“408” /><img class=“aligncenter size-medium” src=“https://peakprosperity.com/wp-content/uploads/2021/09/Bitcoin-Preference-Chart-1024x756-1.png” alt=”“Bitcoin preference chart” width=“512” height=“378” />

Odds are very high they will disrupt and transform nearly every business model in today’s economy, much in the same way the advent of the Internet did.

<img class=“aligncenter size-medium” src=“https://peakprosperity.com/wp-content/uploads/2021/09/960x0.jpg” alt="“Crypto projected adoption reate” width=“960” height=“475” />

But most people are still unfamiliar with this new technology, and concerned that their lack of understanding may leave them obsolete dinosaurs in the coming future should crypto indeed change the nature of money and commerce.

This is why we’ve brought on this week’s guest expert, Alex Saunders, respected Bitcoin/blockchain/crypto maven to demystify the topic and explain it all to us in plain layman’s English.

What is it? How does it work? What benefits does it offer? Should you own any? If so, how should you buy it? All these fundamental questions and more are addressed.

We’re tackling this topic now not only because a number of our viewers have been requesting we do so, but also because it dovetails with the insights our previous market and economic guest experts have shared. The world’s fiat monetary systems are being highly abused, deformed and distorted right now, with $trillions in new currency being wantonly conjured at-will by global central banks. This debases the purchasing power of our capital, and leads to dangerous asset price bubbles and reckless malinvestment.

This trajectory will not end well. We need sound money and better models going forward.

Will blockchain-based technologies be part of that solution? Quite possible. Which is why we all should start investing the time to learn at least the basics of them now:

Anyone interested in scheduling a free consultation and portfolio review with Mike Preston and John Llodra and their team at New Harbor Financial can do so by clicking here.

And if you’re one of the many readers brand new to Peak Prosperity over the past few months, we strongly urge you get your financial situation in order in parallel with your ongoing physical coronavirus preparations.

We recommend you do so in partnership with a professional financial advisor who understands the macro risks to the market that we discuss on this website. If you’ve already got one, great.

But if not, consider talking to the team at New Harbor. We’ve set up this ‘free consultation’ relationship with them to help folks exactly like you.

SCHEDULE YOUR FREE CONSULTATION

This is a companion discussion topic for the original entry at https://peakprosperity.com/bitcoin-101/

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I realize it’s not perfect as it relates to NAV tracking, but my current (and only) exposure to BTC is through the Grayscale product via eTrade. Does this count (from a risk perspective) as exposure?

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is quantum computing a threat to bitcoin and if so can it be fixed and if it can be fixed then how?

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Blockchain is definitely something worth paying attention to. Cryptocurrencies are only one aspect, but perhaps the most common. Yet, very volatile.
Anyone familiar with Pi Network? I just read their white paper. Created by Stanford University PhD Graduates. Early phase so it’s not worth anything yet (same as Bitcoin in the early days), but interesting nonetheless and completely free. It’s invite only, so if you’re interested in a closer look you can use the code { suffix101 } to get in. Not trying to promote it, just genuinely curious to hear your thoughts on this one. Seems promising to me. Just Google ‘Pi Network’.

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Thanks for setting this up, Adam. I’m not sold on the concept at this point, but that might just be my age. A couple of points stood out - first, Alex said something about “if we all agree that this is the new store of value…” then cryptocurrency would work so well for so many reasons. It may happen, but it takes a long time for a statistically significant number of people to agree on ANYTHING. Inertia plays a big role here. Also, the whole aspect of “no government control” would probably take a back seat to whatever is legislated as an acceptable form in which to pay taxes. While this doesn’t remove cryptos as an alternative currency, it makes it less likely that it would become mainstream. And if the government does accept some form of distributed ledger currency, my bet is that they’d have a finger in that pie.
I’m also still concerned about the energy use involved, just because, on the other side of the PP set of probabilities, we could well be looking at less technology and fewer reliable energy sources, rather than more, going forward.
But who knows? So many possibilities, so many brick walls to butt our heads against. Not sure which is which :slight_smile:

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1). BTC will never be used to buy oil.
2) Government/Fed will crack down on use of all non-Fed approved cryptocurrencies in some form or fashion. Crypto is traceable, but difficult to do so. Solution is make rules/taxes limiting it, and crack down extremely hard on the few people they catch breaking rules or evading taxes.
I totally get the theoretical asymmetrical risk/reward ratio of BTC, but of all powers that TPTB have controlling money is by far, without a doubt, the strongest and most important power they have.
”Whoever controls the volume of money in our country is absolute master of all industry and commerce…the entire system is very easily controlled, one way or another, by a few powerful men at the top."
“He who controls the money supply of a nation controls the nation.”
-James Garfield, the second U.S. president to be assassinated.
The central banks will not allow alternative currencies. The Fed is coming out with their own soon. All transactions will have tracking information…for your own good & protection.
 
And, just for fun, I highly recommend this video as a bonus which is a few steps beyond crypto. A little preview…that bald guy in the upper right hand corner of the YouTube will give you the warmest of all warm fuzzies when you watch it.
https://youtu.be/6Hi4pIjTQ7Q

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Gold and land don’t require power, internet, etc. to buy something. Global warming, overpopulation, resource limitations and political instability could lead beyond big power outages and server farm crashes to a possible inability to maintain our current cloud infrastructure. So what happens to your bitcoin if there is no global internet to maintain that market?

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I guess better late than never

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Every concern raised about BTC and other crypto currency from Gubmint to privacy and power usage has been addressed ad infinitum by me and others. Yet the same people keep raising the same issues which are really non issues. I guess it is fear borne of ignorance.
I suggest knowing a little something about it before commenting.
There are almost 8 billion narratives on the planet and you get to choose. Isn’t that amazing?
 

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Quantum Computer capabilities to disrupt Bitcoin are not near the next corner. It will take years to get there, if at all. Bitcoin developers are on the top of it and will have enough time to prepare Bitcoin if needed. It is believed that the technology to ramp up the security level is known and implementable.

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The prospects are that sooner than later, renewable energies will dominate. So Bitcoin miners will mine with only renewable energy, otherwise they will lose in the block generation cost to profit equilibrium and vanish.
The energy is tied into Bitcoin security. We need to remember that a lot of energy is spent on the security of fiat currencies like the US Dollar, to prevent counterfeit, thefts, bank frauds, computer and communication defense, backups, and the like.

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There is one thing I hope, that the powers you mentioned didn’t invent Bitcoin. Under this assumption, I don’t see how they can win. I believe that they have already lost.

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The software fix to quantum vulnerability is definitely doable - its not even that hard. However making such a change will immediately create winners and losers. Every miner with the current mining hardware will instantly become a loser, since their mining hardware will not work with the new quantum-proof mining code.
That’s billions of dollars just flushed down the toilet for these miners.
What do you imagine they will do? Just say “sure, why not, let’s make the change today?”
No. They will put off making this change for as long as humanly possible.
Same thing happened with bitcoin cash. A perfectly reasonable code change, which would have had the side effect of lowering TX fees which go directly to the miners. Did that get approved?
Ha. What do you think? Of course it didn’t get approved.
Its a bug - and a feature - of the current design of bitcoin. Bitcoin is very strongly feature-change-resistant for items that impact miner revenues. If you like things to remain unchanged, then this is a feature. If you think there are issues that need addressing, then its a bug.

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Bitcoin will have satellite communication, there are pilots in this direction. Also, any communication is fine, phones, radio. Bitcoin Core, which is the consensus rules, is independent of communication. It is unlikely that the Internet will break, but if so, Bitcoin will do better than internet dependent businesses including banks I believe.

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Given that miners replace equipment every 3-4 years, thus the next gen can be designed to support future as well as the past, as needed. The fork will happen, and succeed for a real threat on Bitcoin, as happened on a minor scale with SEGWIT upgrade.

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Quantum computers have a unique quality that allows them to efficiently run algorithms that can easily crack conventional cryptography. Is this a risk for cryptocurrencies? Yes and No. Yes, conventional cryptography, which is the backbone of common internet security (most internet traffic is encrypted) and is also the backbone of current cryptocurrencies, is absolutely completely vulnerable to quantum computers.
But, no, this isn’t a deal-breaker for cryptocurrencies or for basic internet security. Experts are well aware of the issues and have been working on quantum-proof encryption for quite awhile now. As quantum computers become more powerful and more common, standards will be developed for these new quantum-proof algorithms, and a new type of encryption will be adopted everywhere.
Just try to remember that the internet itself cannot safely function without good encryption. E-commerce, online banking, and anything that requires a login password will be completely compromised unless new cryptography becomes widespread. Very smart people are working on this and they already have excellent solutions.

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Politicians are scared to death of blockchain voting because it would be very hard to game. No more easy votes for cigs (van pickup).

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https://www.youtube.com/watch?v=MiHfwUFV9HA

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https://www.youtube.com/watch?v=wlzJyp3Qm7s&t=97s
Some people just love to see solutions and look for problems

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https://www.youtube.com/watch?v=wlzJyp3Qm7s&t=97s