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Blockchain Technology Investment

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Hello friends, in today’s article we see the Blockchain Technology Investment in form of Computer science and understand the basics and their goals.

We see in the previous article, that the main goal of making a bitcoin is to remove the Bank to make payments person to person. to complete this goal, one system is developed in that system blockchain used.

Read this article to understand better.

Blockchain Technology Investment

Blockchain Basics

Blockchain Technology Investment Goal:-

In this article, we see Blockchain in computer science opinion.

Software System:-

to Implement any software system, many have two ways

  1. Centralized
  2. Decentralized

In a centralized system, one single component controls the whole system.

In a decentralized system, no one control and every component are equal & corporate between them.

Every software must have Integrity, which means the system developed for that purpose work like that.

the system, keep data that are correct and complete, no other person, can’t interfere

Integrity is a very important thing for any software system. (Blockchain Technology Investment)

If the system doesn’t have integrity then, data may go, behave weirdly or any outsider can steal private data.

Up to now, we have learned, that the software system has two types

  1. Centralized
  2. Decentralized

and any software maintains integrity is very important

In a centralized system, maintaining integrity is easy. Because central components control all components.

But in a Decentralized or Peer to Peer system maintaining integrity is very difficult and there is no other center Patry.

In peer to peer system, anyone can join or leave it, so we don’t know, how much they are worthy of belief.

So to maintain peer-to-peer system integrity use Blockchain.

Blockchain is a way to do basic work.

so the question here is

Why are this peoples excited about Blockchain?

To understand, this we have to look blockchain timeline.

In Past, Firstly there is only cassettes to listen to songs, then comes the DVD/CD

But, Nowadays, all ends, now you can download music or stream online and listen to music and also you can share mp3 files with your friend this system started with the Napster Company

Napster is Peer to Peer ( P2P) music-sharing Internet Software.

So this company brings the revolution, by cutting off middlemen. Previously, music studio was mighty in the music industry.

Because, this studio, distribute all music in-country or stays, worldwide. They have their own established networks.

As an Internet company, Napster company develops software, and everyone downloading, like if I  want to download a song, then I search on software, and the software tells me which peer has that song.

So I directly download that song from that peer’s computer. same as, if someone wants my song, then they can download it from my computer. (Blockchain Technology Investment)

Napster company destroyed the big studio power, those are middlemen of singers and customers, from this story, we know that the P2P system has the power to remove Middleman to removing middlemen called disintermediation.

Most of the time middlemen take advantage of producers and customers. they take lots of money from customers and give little to the singer.

Real money, is only made by middlemen.

Any industry acts like a middleman, on those things, reaching from producer to customer, they are digital. so this industry is called as peer to peer system and have.

Capability to destroy middleman. In the financial industry, the major part is, money is transferred from supplier to consumer. Money’s digitalization and P2P system can change the whole financial industry by remaining lots of middlemen.

So these things make excitement in Blockchain technology.

Disintermediation of the financial industry excites people. P2P group has the capability to maintain disintermediation to maintain P2P system integrity, we use blockchain.

let’s understand what is blockchain?

What is Blockchain:-Blockchain Technology Investment

Blockchain is a combination of technologies such as

  • software/algorithm ( record transaction)
  • Data structure ( store data in blog form )
  • Cryptography ( use the hash function, digital signature, and provide security)

used to maintain the integrity of the P2P system.

People called Blockchain a ledger you can understand. Blockchain is a distributed P2P system of ledgers that uses.

  • Software/algorithm ( Record transaction)
  • Data structure ( store data in block form)
  • Cryptography ( use hash function, digital signature)

to maintain its integrity.

Now we understand Blockchain is a Ledger and stores transaction data or story anything, so now we can decide, who gives to

Reading and writing access

Reading Access means: that the transaction is already in a register, and who can see who gives Reading access is depend on Transparency and privacy.

If reading access all over the world means anyone can see the registered transaction, the blockchain is public.

This means we need transparency

Bitcoin and Ethereum, blockchain is public. On the other side, only a few have reading access then Blockchain is private. (Blockchain Technology Investment)

e.g. any company develops its own Blockchain and any that companies employee has reading access.

Now, let’s see writing access.

Writing access means, in the register, who can upload transactions means we can create the block.

who gives the writing access, is dependent on Security and speed

If writing access has to all users, means anyone can create the block. so that’s a blockchain called Permissionless Blockchain.

In this blockchain, security is more important because, we can’t believe in anyone, to prove work, we can secure the blockchain.

Bitcoin and Ethereum Blockchain is permissionless

On the other side, only a few people have writing access & I believe on them then that blockchain is permission blockchain.

so in this speed is more important & don’t need proof of work. Because

we have people, that we can believe, can upload transactions in the register.

Most commercial application speed and scalability are more important, so

Permissioned blockchain, most companies used. and they give writing access to a specific department.

From this four versions of blockchain occurs.

  1. Public and Permissionless Blockchain
  2. Public and Permission Blockchain
  3. Private and Permissionless Blockchain
  4. Private and Permission blockchain

1) Public and permissionless blockchain:-

This blockchain talks about disturbing the world. Examples, are Bitcoin, Ethereum

The main use is for speculation

Wrong work happens in this blockchain-like, dark net, mainly for Rob’s public

Most of the public and permissionless blockchains fail if they stay like this.

  • anyone can join, read, write, and commit
  • Hosted on public servers
  • Anonymous, highly resilient
  • Low Scalability (Blockchain Technology Investment)

2)Public and Permission Blockchain:-

  • Anyone can join and read the transaction
  • Only authorized and Known participants can write and commit
  • they have the medium Scalability

3) Private and Permissionless blockchain:-

  • Only authorized participants can join, read and write
  • Hosted on private servers
  • High Scalability

4) Private and Permission Blockchain:-

  • Only authorized participants can join and read
  • Only the network operator can write and commit
  • Very high scalability

Use in a commercial context, in that companies process, automate, and standardize on streamlining

private or permission blockchain use on a large scale, in all industry

funny things is here,  the main goal of blockchain technology is to make public and decentralized and this form they mostly failed.

but successful in private and permission blockchains.

this is efficiently handled by the big complex process and companies get here powerful. to remove this person this technology developed, and now this technology makes them powerful.

 

Finally, Blockchain Technology changes the world like the Internet, but not like that when they start with their thinking.

In 1994, Tim Berner Lee has a vision of a Blockchain,

The Internet is decentralized open, universal, and nondiscriminating, but not the internet is not like that

FACEBOOK, GOOGLE, and Amazon-like tech giants control all.

In Blockchain, sure this thing happen

Because, there is no difference, in how much your technology is superior or how much pure your vision

the difference is, can you adopt this technology, without violating any law to succeed in this work,

the required money power and resources, they have only to government or tech giants.

This is all about Blockchain technology.

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Is Bitcoin a Currency or an Investment?

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Hello friend, in today’s article, we see is bitcoin a currency or an investment? and what is the effect on our economy and how we can use it for our best use? so let’s see each and every factor.

Previous Bitcoin Article

is Bitcoin a Currency or an Investment?:-

Is Bitcoin a Currency or an Investment?

before the start, let’s understand these terms

Currency means, a medium of exchange,

Investment means, allocating resources for profit.

before considering bitcoin as a currency, understand what is the factor that leads to currency.

A most important requirement of a currency:

Stability:-

Stability is the most important requirement of a currency, so let’s understand, bitcoin is stable or not.

if the currency is not stable, then it’s difficult to exchange.

let’s understand with an example

Suppose you want to take 100 rupees in payment from someone, and you get at the morning. and evening currency prices go down up to 90 rupees, then this type of volatility you don’t like it and this type of currency no one use it.

Is Bitcoin Stable:-

So the answer is, No

Bitcoin is extremely volatile because bitcoin is not a good currency.

Let’s suppose for a minute

is bitcoin a good currency if it becomes stable?

Now, we can use as currency for this question answer is No,

Because of the problem of scalability.

In bitcoin, by increasing trading volume it takes 16 hours to execute the transaction and increases the transaction fee.

If our world’s transaction is on bitcoin, then their trading transaction execution period takes a week to complete and the fee goes to maybe $100.

So no one waited for this time period and no one want to pay that high fee.

Let’s suppose for a minute, the Problem of scalability is solved

is bitcoin a good currency if it becomes scalable?

The answer is, No

Because bitcoin supply is not controlled by central banks or the government ( reserve bank) to run the economic cycle very well.

Money supply may increase or decrease by the reserve bank ( central bank). so bitcoin is not controlled that’s why the answer is no.

If the government increases the money supply more than GDP growth, then inflation increases.

Inflation is good, that’s why the economic engine (cycle) works well.

inflation means your money value decreases in the next year.

Because of inflation, this thing people get helped or motivated to invest their money and spend wisely.

so in bitcoin, the money supply is fixed, so inflation is impossible, but deflation may happen.

Deflation means, your money value increase in the next year, so because of this people don’t spend money or do not invest money in this activity, economic engine stop.

and like in 1929, the Market crash, after this crash, the great depression comes, that type of thing happens if deflation of money increases so recovery takes almost 10 to 20 years in future.

In summary says, If all problems solve with bitcoin without the permission of center and government this bitcoin can’t use as a currency or not work as a currency.

if government interference is required to use bitcoin as a currency, then why government uses bitcoin as a currency, then they can use their own digital cryptocurrency like rupee coin, etc.

so above discussion, we conclude that bitcoin is not a good currency.

 

so now let’s see whether bitcoin is an investment or not

 

A most important requirement of an investment?

Growth:-

Is important to become an investment.

has bitcoin shown any growth? the answer is

yes, bitcoin gives, a 1,000,000X return ( you can read the previous article) in 10 years

so this type of growth, not even the stock market gives.

Bitcoin is a very high-risk, very high return investment option.

so this investment is not like Benjamin Graham, Warren Buffett, and Charlie Munger’s definition of investment.

for this speculation option to be precise.

Bitcoin is just like, bonds and stocks, but the only difference is bitcoin’s value comes from intersubject reality

means, people things, ow bitcoin has value is $150,000. so big value becomes that if everyone thinks the value is zero, then their value becomes zero.

anything, cannot be currency and investment both at some time.

Because stability and growth can not exist at the same time.

If stability has then growth can not exist at the same time.

if growth has then stability can not exist at the same time.

so people whatever say, like, bitcoin is currency, they can replace bank, but actually everyone thinks Bitcoin is an investment.

to prove this point,

when the bitcoin price goes stable, by seeing the price of bitcoin, people don’t get happy, they get worried about why people’s bitcoin goes high, and say bitcoin stop going higher.

Because people stop accepting bitcoin so above thought needs profit, not a currency lover.

so the last conclusion is that Bitcoin doesn’t have a currency future but bitcoin can become part of investments like bonds, stock, and cryptocurrencies.

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